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. ®

Internet Security Threat Report 2014

More from The Register

next story
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
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Radio hams can encrypt, in emergencies, says Ofcom
Consultation promises new spectrum and hints at relaxed licence conditions
Special pleading against mass surveillance won't help anyone
Protecting journalists alone won't protect their sources
Big Content Australia just blew a big hole in its credibility
AHEDA's research on average content prices did not expose methodology, so appears less than rigourous
Vodafone to buy 140 Phones 4u stores from stricken retailer
887 jobs 'preserved' in the process, says administrator PwC
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
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?
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.