Changes to GST-free threshold delayed until 2018

Productivity Commission to scrutinise tax changes

Senate amendments to the Treasury Laws Amendment (GST Low Value Goods) Bill 2017 have formally been accepted by the House of Representatives.

As a result, measures to end the GST-free status of sub-$1000 purchases from overseas sellers will be delayed. Earlier this week the Senate passed the legislation with amendments moved by Labor. The changes to the GST now won’t kick in until 1 July next year; they had been scheduled to take effect from 1 July 2017.

The amendments also mandate a Productivity Commission inquiry into the impact of the changes to the GST, including alternative methods for collecting GST on low-value goods from overseas suppliers.

Under the new model, marketplace-style services such as eBay will be on the hook for collecting and remitting GST for low-value purchases made from overseas sellers.

eBay has previously said it may be forced to prevent Australians from making purchases from overseas vendors because of the changes. The company’s local managing director, Jooman Park, said the legislation was “complex, inconsistent, unworkable and will harm Australian consumers in many ways” in a submission to a Senate inquiry.

Following the passage of the legislation in the Senate, eBay issued a more subdued response:  “eBay welcomes the review by the Productivity Commission and looks forward to working with government and the industry on methods of implementation that drive revenue, help level the playing field for Australian businesses and maintain choice for shoppers,” a spokesperson for the company said.

eBay has argued that the government should work with logistics companies to collect GST on imported goods. Amazon, Alibaba Group and Etsy have also advocated such a model.

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