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Public Administration News  
Australia Considers Tax on Internet Shopping
Source: radioaustralianews.net.au
Source Date: Wednesday, November 24, 2010
Focus: ICT for MDGs, Internet Governance
Country: Australia
Created: Nov 29, 2010

The Australian government says it will consider imposing the Goods and Services Tax (GST) on imported goods worth less than $US1,000 to help local retailers compete against online stores.

Retailers say the current GST rules and the strength of the Australian dollar have prompted many consumers to buy goods from international websites, hurting the economy.

A spokesman for Assistant Treasurer Bill Shorten says the issue deserves serious examination.

He says while the threshold is good for consumers, it needs to be balanced against the interests of retailers.

On Tuesday, Harvey Norman boss Gerry Harvey said local retailers were under threat from online stores and called for online purchases from overseas to be taxed.

"A good government would look at it, anticipate the problems, and start doing something about it," he said.

"They wouldn't sit there and just ignore it and say it's too hard. But guess what they'll do? They'll sit there, they'll ignore it, it'll be too difficult. They'll make excuses, then later on [say] 'oh yes we should have done something back there. I wish we'd been a bit smarter'."

But consumer group Choice says any move to extend the GST on goods bought over the internet needs to be carefully thought through.

Christopher Zinn from Choice says retailers are hurting but adjusting the GST on internet buys isn't necessarily the answer

"When the dollar goes through its normal cycle and drops again is it necessary to adjust the threshold at this stage," he said.

"Other questions are how do you administratively collect it. In the United Kingdom for example they have a lower threshold but people self report and again one would ask how effective that really is a tax collecting system."

Currently consumers can purchase goods worth up to $US1,000 online from overseas without paying GST.
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