Australia introduces sales tax for digital importers in July

It will be a familiar concept to those of you who sell and export within Europe, because it’s rather akin to what has been colloquially referred to as VAT MOSS . Within the EU, without a lower threshold, you need to pay VAT at the local rate of the recipient (not your domestic rate) if you’re selling digital items such as downloads, games, software even knitting patterns.*

Changes to the law coming in Australia, commencing on the 1st July 2017, mean that if you are sending digital items to Australia, then you’ll need to meet their new regs and pay a GST (General Sales Tax). The Aussie government expect to see revenues into their coffers of AUD$200m by the end of 2018. And it’s not just and Australian trend: Russia and Serbia are doing similar.

So, if you are sending intangible digital goods to Australia, it’s worth exploring the situation now. You may well need to be registering with the ATO (Australian Tax Office), start filing GST returns, settle up with the ATO and comply (generally) with Australian GST regulations.

Depending on the scale of your operation, it will be worthwhile getting in contact with and assessing the situation with a professional expert. Some of the firms in the Tamebay Guide will be able to help.

It’s increasingly the case that cross-border trade is being targeted by governments who (probably quite correctly) reckon they can make some money from greater regulation and taxation. Thus far the focus has largely been on digital and downloadable goods but who knows where the trend will end? Will you be impacted by the Australian change?

*The VAT Moss situation does have some complexities. And you can read more about it here.