Feeds

Internet retail tax threshold 'probably irrelevant'

Oz Productivity Commission looking at online sales

Secure remote control for conventional and virtual desktops

Australia's Productivity Commission is re-igniting the debate about online retail, competition and taxation, with an issues paper published late last week.

The paper, titled "Economic Structure and Performance of the Australian Retail Industry", launches the commission's inquiry into the industry, with a particular focus on issues such as the impact of online retailing, and whether current tax and regulatory instruments need updating.

Since early this year, traditional retail players have been calling for a change to the threshold at which the GST (goods and services tax, analogous to the UK's VAT) is collected on purchases made from overseas internet sellers. While GST is legally due on all purchases, there is a long practice of not seeking to collect it when the purchase is less than $1,000.

Retailers blame this 10 per cent impost – or rather its lack – for making them unable to compete with products sold on sites like eBay.

The Productivity Commission appears to have only limited sympathy for this notion, however. The commission writes that the "value of parcels currently entering Australia and taking advantage of the low value threshold is less than $100". This figure, the commission notes, will be known with greater confidence when a study by Australian Customs is completed.

If, as the commission expects, internet imports favour low-value products, it says an adjustment to the GST collection threshold would have little impact.

Interestingly, data presented by the Productivity Commission and sourced from the Australian Bureau of Statistics shows that "non-store" retail (including internet retailing) fell in Australia during the period 2008-2009, losing 22 per cent of revenue in Australian dollars.

The commission also subtly undermines the oft-stated nostrum that Australian retail prices are higher than those overseas because we have (relatively) higher costs for physical retail rents.

It notes that IBISWorld data ranks retail trade in Australia as offering the second-highest industry sector in terms of return on shareholders' funds, "notwithstanding labour and occupancy (including rental) costs" that "appear high" when compared to other countries such as the USA.

Submissions to the Productivity Commission inquiry are invited until May 20, 2011. ®

New hybrid storage solutions

More from The Register

next story
Hey, Scots. Microsoft's Bing thinks you'll vote NO to independence
World's top Google-finding website calls it for the UK
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
OECD lashes out at tax avoiding globocorps' location-flipping antics
You hear that, Amazon, Google, Microsoft et al?
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.