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Tuesday, July 18 2017 - 00:00
AsiaNet
Australian Taxation Office Introduces New Tax Measure for International Merchants
CANBERRA, Australia, July 18, 2017 /PRNewswire-AsiaNet/ --

Australian Goods and Services Tax (GST) will apply to international businesses 
that sell low value goods to consumers in Australia 


From 1 July 2018, Australia requires businesses that sell goods into Australia 
to charge goods and services tax (GST) on goods valued at A$1,000 or less. This 
includes goods sold by merchants, on-line marketplaces and for those supplied 
via re-deliverers.

Businesses that sell more than A$75,000 of these low value goods per year to 
consumers in Australia will need to register with the Australian Taxation 
Office (ATO) and charge GST on these sales. 

Those that sell less than A$75,000 worth of taxable supplies (including low 
value goods) to consumers in Australia per year will not be affected. There 
will be no requirement to charge GST on goods valued above A$1,000 as they will 
be subject to existing border tax, duty and import clearance processes.

This change will ensure that low value goods imported by consumers will have 
the same tax treatment as goods that are sourced from within Australia. It will 
mean a more level playing field between local businesses and their global 
competition, since domestic suppliers are already required to charge GST, 
regardless of the value of the product.

Australian online shopping habits have been steadily increasing over the last 
few years with overseas retailers reaping the rewards. This trend is set to 
continue, representing an even bigger opportunity for those retailers who 
continue to build brand loyalty and recognition in the Australian market. The 
NAB Online Retail Sales Index 
(http://business.nab.com.au/wp-content/uploads/2017/05/norsi-march-2017.pdf ) 
estimated that Australians spent $22 billion on online retail in the year to 
March 2017, a nine percent increase on the previous year.

"Many suppliers now transact across the globe and it is often no more difficult 
for Australian residents to purchase physical goods from a foreign supplier 
than from a local supplier," said Kate Roff, Assistant Commissioner at the ATO.

"It has become very common for Australian consumers to purchase a wide range of 
products like clothing, electronics and other goods from online retailers. The 
new law will require overseas business, including on-line marketplaces and 
re-deliverers to apply GST to these products, resulting in a more even tax 
treatment for all goods" concluded Roff.

Overseas businesses do not have to register if they only make business to 
business sales. Those that are registered will not have to charge GST on their 
business sales if the purchaser provides their Australian Business Number (ABN) 
and notification of their GST registration.

This measure adds to other Australian GST changes being implemented on July 1 
2017, that require businesses that sell imported services or digital products 
to Australian resident consumers to register for GST and apply it to sales made 
to Australian consumers. This includes architectural or legal services, and the 
streaming or downloading of movies, music, apps, games, e-books, gambling and 
online dating services. 

You can find more information about the Australian GST by:

visiting our website at ato.gov.au/AusGST, or 
emailing us at AustraliaGST@ato.gov.au 

Media Contact:

Nick Timms
d: +61-2-9928-1519 
m: +61-431-214-852 
nick.timms@bm.com 

SOURCE:  Australian Taxation Office
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