Treasurer Scott Morrison stated that Australia would be the first country to apply GST to the importation of low value goods using a "vendor collection model", with jurisdictions such as the European Union moving in the same direction.
Mr Morrison said in a statement it would help “level the playing field” for Australian businesses competing against those overseas.
As of July 1 2017, overseas clients with an Australian turnover of $75,000 or more will be required to register for, collect and pay GST on any goods up to $1,000 that they sell to consumers in Australia.
The change would mean that if an Australian business is registered for GST and purchases low value goods from overseas, that business will need to supply its ABN at the time of purchase so that it won't be charged GST. However, if a business chooses not to be registered, or purchases of low value imported goods are not for a business purpose, GST will be payable and unclaimable.
These proposed changes are currently before parliament (in Treasury Laws Amendment (GST Low Value Goods) Bill 2017).
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