On Thursday 16th February Australia’s Federal Treasurer introduced the Treasury Laws Amendment (GST Low Value Goods) Bill 2017 into Parliament’s House of Representatives.
Back on 12th November 2016, we reported on the government’s intention to remove the ‘De Minimis Level’ for GST on imports. Now the legislation has been introduced into Parliament and is due to take effect from 1st July 2017.
Basically, it will give effect to the 2016-17 Budget decision to apply GST to ‘low value’ (under $1,000) imports. The law will now require the overseas supplier to account for GST on sales of low value goods to consumers in Australia, if they have GST turnover of $75,000 or more.
The intention is that low value goods imported into Australia will face equivalent GST treatment to goods that are sourced domestically. If a GST exemption code is used, the Australian importer must be able to prove GST was paid at source. Overseas Vendors, electronic distribution platforms and ‘re-deliverers’ will have to account for GST on sales of low value goods to consumers, whenever they have an annual turnover of $75,000 or more. (Note: ‘re-deliverers,’ which were initially called ‘goods forwarders’ in the draft legislation, are not freight forwarders - rather they are typically re-senders of goods from a consolidated payment and despatch facility – which is common with overseas transactions in the USA).
The Department of Immigration & Border Protection (DIBP) will be advising industry professionals, including your Customs Broker, on the formalities required for completing Customs entries on your behalf. Please contact us at Colless Young if you have any concerns about the new application of GST.