eBay, Australia and $1000 Thresholds for Purchases

txb on 07/12/2018 - 21:16

Whats to stop an Australian buyer asking an overseas seller to declare the value below $1000? (providing the sale of the ebay item was over $1000 in this case ebay does not add gst as it is collected at customs)

The buyer dosent pay GST at checkout
The buyer gets his $1000+ purchase into the country

Doesn't seem fair there are these loopholes! yet low-cost purchases are slugged with GST (at the point of sale if imported from overseas by consumers in Australia.ebay and passed on)

Im purchasing a few garage electronics worth a few hundred, what happens if I want a refund? Do customs issue the refund? does ebay?
Do items worth a few hundred stack up if im buying in frequency? (multiple orders within a short time that will eclipse $1000) <— wouldnt that appear to gaming the system even more, spreading out lower values?

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Comments

  • whooah1979 on 07/12/2018 - 21:30

    Buyers gets a full refund.

  • Diji1 on 07/12/2018 - 22:25
    -1

    Doesn't seem fair

    Yes, a VAT (GST) is pretty much the most unfair tax that can be devised.

    For every dollar wealthier the taxpayer is the tax rate applied to them drops in a proportional fashion. The person who is taxed the least under a GST is Australia's wealthiest citizen. The highest rate is paid by the poorest citizen.

    And people voted for this apparently because of a Liberal Party ad featuring working class icon Joe Cocker singing Unchain My Heart and because they thought everyone would be rich by taxing people unfairly because neoliberals said so. Makes no sense but apparently they still hadn't worked out that trickledown economics was a scam.

    https://www.youtube.com/watch?v=4wcJDSZJhY8

    GST ensures every homeless person in Australia pays tax at a higher rate than Qantas, a corporation that takes over 1 billion dollars in profit every year.

    • NotSureAboutThatMate on 08/12/2018 - 03:51
      +3

      On the other hand, it's the most fair.

      It is a flat percentage equally applied to every man regardless of his income. And, given that spending scales with income, the real amount scales proportionally. If you make $50k, and I make $500k, you pay just $1 tax on your $10 bottle of grog, while I pay $10 tax on my $100 wine. Income tax is already levied exponentially (I believe it should also be a flat %); you want to do the same to them again when it leaves their wallet too?!

      As for the homeless guy, I hardly think that net tax recipients have the right to complain about tax rates. Who cares what his tax rate is? I can hardly fathom the sense of entitlement one must have to stuff their pockets full of public funds while complaining about having to put a tiny portion of it back.

      • JimmyF on 08/12/2018 - 07:52

        I can hardly fathom the sense of entitlement one must have to stuff their pockets full of public funds while complaining about having to put a tiny portion of it back.

        and don't forget those public funds are INCOME TAX FREE! to start with ;)

    • JimmyF on 08/12/2018 - 07:51
      +1

      GST ensures every homeless person in Australia pays tax at a higher rate than Qantas, a corporation that takes over 1 billion dollars in profit every year.

      GST (the tax in question on this thread) is paid by Qantas on its 1 Billion in SALES, unlike you claim. They can't avoid paying GST.

      You're confusing income/corp tax on profits with GST.

      GST ensures every homeless person in Australia pays tax at a higher rate than Qantas,

      A homeless person would be paying ZERO income tax, unlike Qantas that pays tax on its profits + GST on its gross sales + payroll taxes + super etc etc

      • whooah1979 on 08/12/2018 - 08:30

        You're confusing income/corp tax on profits with GST.

        Diji1 isn't confused. Their post is meant rally up support from those that doesn't how we are taxed.

        A homeless person would be paying ZERO income tax, unlike Qantas that pays tax on its profits + GST on its gross sales + payroll taxes + super etc etc

        To be fair. A homeless person pays no income tax, but should pay GST where it's applicable.

      • D C on 08/12/2018 - 17:37

        GST (the tax in question on this thread) is paid by Qantas on its 1 Billion in SALES

        Not this again.

        Qantas doesn't pay GST. Businesses do not pay GST.

        The CUSTOMER, ie YOU, pays GST. Qantas merely collect it and pass it to the government (who then give it to undeserving homeless people).

        Why do so many people struggle with this concept? No wonder Donald Trump is going to our next PM.

        • JimmyF on 08/12/2018 - 20:08

          Qantas doesn't pay GST. Businesses do not pay GST.

          Read what I was replying to

    • whooah1979 on 08/12/2018 - 08:07

      Almost every civilised nation in the world have some form of VAT. VAT helps to pay for public services.

      https://merchantmachine.co.uk/sales-tax-vat/

  • ibuy on 08/12/2018 - 00:10
    +4

    There are ways around this which some people are using.

    If you have a relative in the country you are buying the item have it sent to them and onsent to you. Frieght forwarders have to charge GST on the shipping and the item. However if you have a relative sending it then there is no GST on the item nor the shipping fees.

    You may also be ablw to find someone on airtasker which is what other people are doing.

    The system as it stands is not raising any net income for the government which is what is stupid. That’s why there was the $1,000 threshold in the first place as it was just too costly to collect.

    So the $1 you’re paying in GST costs about $3 to collect. So for every $1 collected the Government loses $2. That means there is less money for schools, transport, accommodation and infrastructure. And we as taxpayers fund the pollies to implement these policies. If they were in private industry they would have all been fired by now.

    This actuon is just a reflection of Government bowing to big business and the lazy Australian businesses who believe levying the GST creates a more level playing field. However in reality if the only difference was 10% then you would see a lot more buying locally. That really hasn’t happened because customer service is still crap and price competitiveness from overseas is greater than 10%. Case in point - look at Myer. They were recently placed in a trading halt on the stock exchange because they refused to provide sales figures which probably would have sent the shares to near zero. This company was once a highly profitable business because customer service AND pricing was competitive. Then the people at the top got too greedy and let the customer service fall to almost non existent service. A few weeks ago I was in a Myer store and there were two shop assistants in the department. They were happily chatting to each other and couldn’t give a damn about whether I wanted some help or to even acknowledge I was there and wanted to buy something. So basically I went elsewhere and bought my items. Ironically stores like Big W and K-mart provide better service.

    • Blitzfx on 08/12/2018 - 01:03

      The gov was such a piece of shit for trying to penny pinch the individual Aussies buying <$1k. The bigger money is taxing the big companies and mining, which they didn't even bother looking at because they're all corrupt.

  • maggs on 08/12/2018 - 02:24

    I ( and many others ) will continue to buy vaping paraphernalia and electrical goods from China as, even with the 10%, still heaps cheaper than buying here, I'd sooner support the local community but local businesses are too greedy for profit and being on a fixed income means I'll go for cheapest price for identical items

  • Cheeper on 08/12/2018 - 09:04
    +2

    (Diji) "Yes, a VAT (GST) is pretty much the most unfair tax that can be devised."
    Really? You know it replaces a wholesale sales tax that was much higher..

    Schedules 1 to 7 of the Sales Tax 'Exemptions and Classification) Act 1992.

    Schedule 1 exempts the goods listed, and hence a 0% rate applies.
Schedule 2 - 11% until 1 July 1995 when it increases to 12%
Schedule 3 - 16% until 1 July 1995 when it increases to 17%
Schedule 4 - 21% (the general rate) until 1 July 1995 when it increases to 22%
Schedule 5 - 31 % until 1 July 1995 when it increases to 32%.
Schedule 6 - 45%
Schedule 7 - 24% until 1 July 1995 when it increases to 26%.

    The items at the higher end of the scale were items that are popular purchases today… electronics..
    Makes you appreciate GST a little more.

    "The person who is taxed the least under a GST is Australia's wealthiest citizen."
    On income? Looks like those high earners pay a LOT more.
    Taxable income Tax on this income
    $18,201– $37,000 19c for each $1 over $18,200
    $37,001 - $80,000 $3,572 plus 32.5c for each $1 over $37,000
    $80,001 - $180,000 $17,547 plus 37c for each $1 over $80,000
    $180,001 and over* $54,547 plus 45c for every $1 over $180,000

    "And people voted for this apparently because of a Liberal Party ad featuring working class icon Joe Cocker"
    The WST was old, complicated, made many things more expensive and was easy for many to avoid. It was also an administrative nightmare.
    Labor knew it needed to be replaced with a simpler VAT/GST system but did not want to tackle the task.
    Informed people voted for it because they knew it was better and fairer, not because of a TV ad.

    Australians have a mindset that everything must be paid for by the government and a damn lot is.
    Where would the money come from to pay for all that if there was no taxes? You cannot just print money, the system does not work like that.
    You could do away with Medicare, pensions aged and disabled, public housing and rental assistance, the defence force, the police force, customs and immigration, schools and teachers, etc etc etc. That would reduce the amount of taxes necessary?

    "GST ensures every homeless person in Australia pays tax at a higher rate than Qantas, a corporation that takes over 1 billion dollars in profit every year."
    Homeless people are usually unemployed and even if they were earning a modest income the tax would be NIL.
    The hate for big businesses is unfounded. One of the most common things overlooked is the people those companies employ. The employer pays more than just their salary, they also pay payroll tax and other govt expenses involed in having staff. Those employees themselves pay income tax and again pay tax on the goods and services. All paid and in existence because that big business employs and pays those staff.
    You can penalise big business and force them to leave Australia taking employment opportunities with them but not everyone wants a country that survives on welfare. We are close to that..
    Without enterprise and business opportunity we all may as well pack up and go live in the bush. A business must make a profit, that is not a crime. Would you like to run a business that operates at a permanent loss?

    You imply that the LNP is the only party that introduces taxes or enforces them. We have had Labor governments state/fed in Australia too that did nothing to remove existing taxes. I would say that over my many decades they have been responsible for introducting more taxes than any other party.
    The tobacco tax was introduced by Labor lifting it from it's general 10% GST rate. Labor also introduced the current scheme of scheduled increases to tobacco tax several times a year. Not the LNP.

    I like cheap stuff too, who doesn't. But when local businesses pay taxes, not just GST, that are necessary to maintain our way of life it is very unfair when they are made to compete with online retailers that do not. The overseas retailer's cost of premises is minimal and their staff costs are a small fraction of the cost here.

    This is not just about Harvey Norman as is often stated, it is about all Australian retailers that pay taxes and employ people.

    If you owned a business and worked the long hours and had to compete with other sources that are far less unencumbered you would be a little peeved!!
    That is not an even playing field.

    • ibuy on 08/12/2018 - 11:58
      +2

      It would be okay if the GST on overseas goods were to raise net revenue for the country. However what you forget is that it is costing more to collect than it actually raises. It is forecast to raise about $200M in revenue. However the cost of collection is approximately $600M if not more as it doesn’t allow for all the setup costs that the businesses had to pay for to allow for this and some businesses are charging more than 10% to allow for this. And then the Government has announced it would not enforce the collection of the GST from foreign organizations. So some organizations that claim they are registered to collect GST may never send it to Australia. This is because it would cost an absolute fortune to monitor businesses overseas as well as seeking approval from foreign governments to conduct checks into overseas companies and legal costs of pursuing foreign businesses. So your belief that this impost on consumers raises revenue to help the Aussie economy and its people is highly flawed.

      The idea of
      1) a level playing field it is not. For retail to truly compete they must become more efficient, offer better service and good prices. As I’ve mentioned if the only difference was 10% most Aussies would buy local and support the Aussie retailer. However given the crap service from staff and the greed of Aussie retailers (especially Myer David Jones Harvey Norman) and their prices being much higher the trend to buy overseas continues. You also forget that retail bricks and mortar in Austraia is becoming a dinosaur way of selling to the public. We are supporting a system which is out of date. It would be like saying we need to support dial up internet isps so that they’re on a level playing field to nbn, or that electric cars should be taxed more because they will wipe out the existing petrol and diesel car markets. As we move forward things change and Australian retail is not changing fast enough. We live in an era of “disruption” from politics to retail to even our electricity. With the advent of better solar panels for example it will one day be possible for a home to go off the grid which scares electric companies and the Government to no end as the Government is the one managing licensing for electricity and could lose heaps if everyone went off the grid.
      2) if you own a business part of owning a business is being able to move with the times and being dynamic. If you can’t do that you should not be in business or should look recruit people to help you stay ahead. Too many business owners have a sense of entitlement. There is a common thought amongst many business owners that “I’ve been in business 20+ years and the business owes me a return and if things work today why should I change? For a very few businesses that thought process works. However for th majority it requires constant monitoring of changes and updates. From a personal note my Grandfather started operating timber mills and over time transformed his business into other ventures as times changed and it was no longer profitable or worth his while to do so (and the laws also changed to stop him cutting down trees that were once everywhere and then became rare). His business ran within our family for nearly 90 years and the business when it was finally closed (because no one in the later generations wanted to manage it) was very different from what he started out with as the final business was a cold storage business freezing seafood for export. His business survived so long because it was dynamic and he realised that you can’t do the same thing the same way and need to change. That said, the basic tenets of customer service always remained because that’s what kept his customers loyal. It’s not often about working hard or long hours these days. It’s about working smarter and being in the right industries. What people don’t realise is that being in business is a risk. It is a calculated gamble (no different to if you change jobs) and you need to do your due diligence, have contingency plans and other safety nets in place. So many businesses fail because they just don’t do their homework and just focus on blue sky or emotions when they buy the business or start one. Sometimes they need to take a look at the cold hard facts and figures before even starting their business or eat a bit of humble pie when their business is not going the way it should.

    • bigticket on 08/12/2018 - 12:18

      Informed people voted for it because they knew it was better and fairer, not because of a TV ad.

      I would say ill-informed applies here. The liberal party won the GST election on a base of liberal loyalists voters and gullible voters who fell for the promised cuts in income tax.

      These same voters are now scrimping to find ways to avoid paying GST on imported goods, but fail realise the big picture on major purchases.

      Buy a new home for $1m… ask the bank manager for a cool 100k on top.

      Buy a new car for $50k… extra $5k. Buy the same car from a dealer a year later after its been traded in for $30k… extra 3k on a second hand car. Rinse and repeat!

      The GST has not simplified the tax system, it is an add on that has introduced an additional layer of complexity on an existing complicated tax system and has subtlety recruited all businesses as a ATO sub branch office collecting/reporting/forwarding GST to head office. If you are truly after a simplified tax system, start fresh from the ground up.

      Im not against a GST based tax system, just a simplified system that a average person can understand, not the present system where the ATO customer support don't understand the present system.

      • whooah1979 on 08/12/2018 - 15:22

        just a simplified system that a average person can understand

        An average person doesn't need to understand the ins and outs of how GST works. All they need to know is that they pay GST so that their State may fund public services.

    • D C on 08/12/2018 - 18:01

      On income? Looks like those high earners pay a LOT more.

      Uh huh, are you sure about that?

      You should fire up Excel and plot a graph showing tax vs income, it's not the exponential curve you think it is.

      People look at the top tax rate and think: "OMG, I have to pay HALF my pay in tax? It's not fair!"

      Yeah nah.

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