Following intense opposition from consumers and advocacy groups including the Australian Taxpayers’ Alliance and MyChoice Australia as well as the successful efforts of the Keep Shopping Open campaign, the Australian Senate Economics Legislation Committee has recommended that the Turnbull government delay the extension of goods and services tax to imports worth less than $1000 for at least a year.
In their report released last week, the Economics Legislation Committee noted the difficulty and cost that the bill imposes on businesses engaged in online shopping. The legislation was due to take effect from July 1 this year.
MyChoice Director Satyajeet Marar appeared before the committee in Melbourne last month to present the ATA and MyChoice joint submission against the bill alongside Economics Professor Sinclair Davidson of the Royal Melbourne Institute of Technology (RMIT) and Dr. Chris Berg, post-dotoral fellow at RMIT.
The ATA and MyChoice argued that the bill:
- Would hurt Australian consumers and small businesses dependent on online consignments
- Goes against international trends in trade liberalisation and would trigger tariff retaliation by our trading partners
- Imposes a radical and unfair ‘vendor registration model’ on online marketplaces that connect buyer and seller, forcing them to become revenue collection agents for the government and potentially forcing them to stop selling to Australians
- Has not been properly costed or means tested –substantiated by the treasury’s inability to answer questions about the bill’s potential ramifications during the inquiry
- Would be extremely difficult, costly and impractical to enforce
- Will raise very little revenue even if enforced
- Would lead to a rise in dubious black market online marketplaces, leaving Australian consumers vulnerable to fraud with no practical means of seeking relief from Australia
- Fails to create a ‘level playing field’ for Australian retailers whose products will continue to remain expensive due to burdensome costs and regulations imposed by the government
The ATA-MyChoice joint submission can be viewed here.
The full transcript of the hearing in Melbourne can be viewed here.