Australia Eyes GST on All Online Purchases

July 29, 2015 Taxation in Australia

CANBERRA – All online purchases in Australia could soon face GST, regardless of the price and the location of the supplier.

In radio interview on July 27th the Treasurer of Australia Joe Hockey indicated that the government may impose GST on all goods purchased online, with no threshold applied for low-value goods.

Currently, GST is not applied on imported goods valued at less than AUD 1000.

Recently it has been proposed that the threshold be lowered significantly in order to capture online services such as Netflix.

The proposal was for the threshold to be set at AUD 20, however, during the interview the Treasurer indicated that the threshold could be removed entirely, with the tax being applied to absolutely all purchases.

While discussing the practicality of collecting the tax, the Treasure indicated that new technology would allow the national tax authority to track purchases from international retailers and collect the taxes.

The proposal to apply taxes to online purchases has seen significant controversy, but business groups are claiming that such a measure will “level the playing field” between online offshore retailers and local shops.