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GST-free sales: Retailers go to Canberra

March 25, 2010: A group of retailer association representatives headed by Beverly Jenkin, CEO of the Australian Toy Association, visited Canberra this week to discuss GST-free private imports.

The group consisted of representatives of sporting goods, toy, bicycle and fishing products associations. This loose coalition is campaigning for a fair deal for Australian retailers competing against overseas competitors who aren’t required to charge GST on items priced at under $1000.

The original threshold for GST-free sales was set at $250, which was subsequently increased to $1000 in 2005. It’s believed the increase was imposed following lobbying from international courier businesses.
In other similar markets, the tax-free threshold for privately imported goods is under $100.

The photographic industry, which is normally part of this lobbying group via PICA and PMA, did not send a representative to Canberra.

The group briefed staff of the Assistant Treasurer, Nick Sherry, and Customs staff, seeking a two-staged change in the current regulations:

1. An immediate reduction of the GST free threshold from $1000 to $400 in the 2010-2011 Budget to align with New Zealand
2. Post-Budget a detailed review of the GST threshold issue covering issues such as consumer protection and safety standards.

Beverly Jenkin said the toy industry has been actively campaigning to have the threshold lowered since 2004. ‘Suddenly everyone is interested’, she said.

She told Photo Counter the group had a good hearing in Canberra.

‘At least we know the issue is being looked at seriously in Treasury,’ she said.

The group has also sent letters outlining its case to state premiers. The states stand to gain most by an increase in GST revenues via a reduction in the threshold.

COSBOA, the Australian small business association coalition, is also supporting the lowering of the threshold, and passed a motion to that effect at the end of 2009:

That the Federal Government reduces the import entry threshold for courier and postal imports to $60, a level that is on par with the thresholds used by Australia’s trading partners.

COSBOA CEO Jaye Radisich noted that the the motion was not passed unanimously ‘as there were some members not in support of the position.’

‘Whilst this issue is not one of the “top 5” priorities for the organisation this year, we will be supporting the PMAI and the ATA in whatever way we can,’ she wrote.

She noted that the policy group within COSBOA was expanding its areas of interest in 2010.

Photo industry market leader Canon says it supports the industry push to reduce the GST-free threshold

‘We think its one of the measures which are needed [to reduce parallel import sales], said Darren Ryan, Canon’s general manager, Consumer Product Marketing. ‘We don’t know if it’s the “silver bullet”, but it [GST-free sales] is one of the contributors.’

The full submission from the national associations can be found here.

NOTE: In any story on GST-free sales it needs to be acknowledged that Australian company CR Kennedy has been passionately championing the cause for many years, and has the most effective measures in place of all leading distributors to reduce parallel imports of its portfolio of products.

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