Silentium
Member
The analysis I think you're referring to was with respect to lowering the $1000 physical import GST threshold. The analysis was predicated on GST collection occurring at point of entry into Australia, "if the low value threshold were reduced to (say) $500, the additional GST collected would exceed the additional administration costs that would be incurred. There would be a net revenue benefit as a result, but it may not be large — perhaps around $30 million per annum." But the report found, and as I would suggest, the long term solution is to place direct liability on overseas suppliers to Australia residents - in that case, collection costs for the government are minimal, and the threshold can be reduced to a nominal level ($20 or so, like in the UK and Canada).I have heard analysis previously that indicated it would be near impossible to enforce and the cost of doing so would offset any extra revenue generated by the government.
My issue is that as a consumer this government is hell bent on gauging every last cent out of the vulnerable masses while ignoring, or in many cases subsidising, the outrageous profits extorted by those at the top of the pyramid.
Sales taxes help broaden the tax base and are a valid component of a country's tax regime.
Australia can definitely pass a law requiring GST/VAT to collected on sales made by foreign entities to Australia residents. Major suppliers will comply as the collection of GST/VAT like this is not unusual throughout the world (Norway, EU, Japan, and others all collect from similar transactions) and compliance costs are minimal (EU estimated at €5000). If enforcement is necessary, confiscation and bans on imports can be used. The namesake of the proposal, Netflix, has already said they will comply if necessary.You're missing the point.
The Australian government cannot enforce our tax laws on non-residents.
That's our law.
The figure comes from a report completed in 2012 for the Cth gov by former Premiers John Brumby and Nick Greiner, the figure they found was $1B, but some have estimated that the growth of online intangible sales to have increased since then (the $2B may be off I concede, but it is a decent amount p/a).The $2b figure is pulled out of someones ass and is not even remotely realistic. There's no way in hell there's $20bn in untaxed imports of intangibles per year. That would equate to 22m people spending $900/year. Each. What a load of horseshit. I'll start listening to arguments for this when realistic numbers are presented.
As above, the collection is only an issue if completed at import by Custom and Border Control (and no ones looked at collection costs for intangible goods). We are talking about placing direct liability on foreign suppliers to collect and remit GST.The problem with this is that the cost of collection results in a loss on the vast majority of purchases. There was a similar argument on GST for imported goods and the cutoff for profit was something like it only being worthwhile on shipments over ~$500.
The actual reason for blanket GST collection is protectionism/cronyism, ie it artificially increases the competitiveness of Australian companies (the truly sad thing is that in terms of digital goods we already suffer markup levels that mean even this isn't going to make them actually competitive).
Collection of GST is about a level playing field. Other countries already force collection and remission of VAT/GST for similar sales, why should Australian entities be placed at a disadvantage?
EDIT: I'm probably not going to respond to people again. What I would suggest to people is that this proposal isn't unreasonable, it brings Australia in line with other jurisdictions, it protects the GST pool at a time of economic/budgetary pressures, and it will likely have broad political support.