Australia GST is coming for overseas online retailers on 1st July

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Overseas sellers shipping to Australia will soon be subject to a new tax regime. The new Australia GST (general sales tax) will come into force from the 1st July 2018. What do you need to know?

From that date, GST will apply to the sale of low value goods sold to consumers in Australia valued at A$1,000 or less. International retailers must register online if they have a GST turnover of A$75,000 or more per year, according to recent information from the ATO (Australian Tax Office). Businesses that don’t comply will be subject to sanctions.

Our preferred approach is to continue working with businesses to help them comply. However we will make sure that any businesses that have made a genuine attempt to meet their taxation obligations will not be disadvantaged. Businesses that decide not to comply may face penalties. The new taxation measure will provide fairer trading for all retailers and ensure low value goods purchased by consumers in Australia have the same tax treatment, no matter where they are purchased from.
– Adrian Preston-Loh, ATO Assistant Commissioner

The ATO say they will use financial data tracking, customs data and online investigations to identify merchants that haven’t met their obligations. The possible sanctions they might face include:

  • compulsory registration for GST on behalf of the business
  • imposing an additional 75% administrative penalty, which then becomes legally payable
  • intercepting funds from Australia destined for the business
  • registering the debt in a court in the business’ country
  • requesting the taxation authority in the business’ country to recover the debt
  • You can read all about the new Australia GST for online sellers here.

    New VAT rules like the Australia GST are part of a trend that we’re seeing increasingly in regards to global ecommerce. Yesterday we wrote about a similar proposed measure in New Zealand: New Zealand government proposes online shopping “Amazon tax”.

    6 Responses

    1. im assuming this only comes in to play if your total sales to australia go over the $75,000 threshold?as we only sell probably 20-30 low value items to aus which are under £10 each so nothing to worry about i presume?

    2. How will they find out whether I’m making sales equal to the threshold or not? where will get that data? as much as I’m familiar, ebay and amazon never share data and shopify store is seller’s own property? so I’m wondering how will ATO find out the exact volume os sales?

    3. i still cant work it out.one thing says the marketplace is responsible?so will they add it on or just take it from us?then it says you only need to register if you meet the threshold?so surely if your under that threshold you dont pay this gst tax?
      if someone could advise would be great?thanks

    4. still cant seem to find a correct answer for this,one thing says the marketplace is responsible for it?then it says you only have to register if you meet the threshold?so im assuming if you sell on ebay and dont meet the threshold you dont pay gst?s that correct?
      any hellp would be appreciated?
      thanks jodie

    5. Yes no comment or advice from ebay – presumably as they will get their 10% fee of the extra 10% GST to be charged

    6. Is there any communication from eBay on how this will be added to checkout for customers? I won’t be remitting GST out of our current sales price, or increasing it, as it will look less competitive to Australian buyers, who may assume it’s going to get added on top.

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