CANBERRA, Sept. 14 (Xinhua) -- Australian retailers have launched a campaign to have GST (Goods and Services Tax) charged on internet purchases from overseas, warning that Australian governments will forgo revenue of more than 2.4 billion U.S. dollars over the next three years, according to the latest report from The National Retail (NRA) Association Friday.
Internet sales have soared but the commonwealth only charges GST on purchases over 1,000 U.S. dollars, refusing to reduce the threshold on grounds the costs will exceed the actual income. The report conducted for the NRA by accountants Ernst & Young found the failure to amend the low value threshold would deny states and territories up to 2.45 billion U.S. dollars in potential GST distributions between 2012-13 and 2014-15.
The GST, introduced by the Howard Government on July 1, 2000, is a broad sales tax of 10 percent on most goods and services transactions in Australia. It is a value added tax, not a sales tax, in that it is refunded to all parties in the chain of production other than the final consumer.
Gary Black, NRA executive director, said it was time to level the playing field. "The loophole, which is denying the states and territories access to much needed additional GST revenues, is a double blow to their respective economies because the low value threshold also poses the greatest threat to traditional retail jobs and domestic online retail growth," he said in a statement Friday.
Meanwhile, he acknowledged the move wouldn't be popular. "The alternatives are far worse. If we don't act, on our modelling, the Australian retail sector will lose 33,000 jobs. Thirty-three thousand Australian jobs will be shipped offshore between now and 2015," he indicated.