Member for O’Connor Rick Wilson MP says the Government has introduced laws that will help level the playing field for regional businesses, with offshore retailers required to apply the GST on products that cost under $1000 from July 1, 2018.
The Government secured the passage of legislation on Wednesday that will force foreign online suppliers like Amazon to account for the GST on low-value goods.
Until now, this loophole has given an unfair tax advantage to those retailers by relieving them of GST obligations and effectively allowing them to sell the products at a cheaper price than domestic businesses.
Mr Wilson said small retailers, particularly family-run businesses in regional areas, struggled to compete with offshore sellers when forced to pass the 10 per cent tax on to their customers.
“It’s hard enough for our small businesses to operate in a tough climate without allowing overseas vendors to provide tax-free prices,” he said.
“Online shopping is becoming increasingly popular as people look for the cheapest product and multinationals have been reaping the rewards of what is essentially an unfair system.
“When we’re talking about products that cost several hundred dollars, 10 per cent becomes a significant disadvantage for local business owners who have to apply the GST.
“People in O’Connor have told me that the lack of GST for online providers has been hurting their business and it’s about time we put an end to it.”
A Senate committee recommended the Government give the legislation a start date of July 1, 2018 to allow businesses to develop their systems to implement the measure.
In addition to protecting local retailers, the laws will also increase the GST revenue collected by the Government.
States and Territory Governments have supported this measure and unanimously approved the vendor collection model outlined in the Bill.