Online retailers slam Gerry Harvey’s comments: ‘get your head out of the sand’

By Keri Algar

SYDNEY, NSW: The founder of the Australian Professional eBay Sellers Alliance (PeSA) has criticised Gerry Harvey’s call for GST on online goods purchased overseas for under $1,000. Pierre Boutros of Millennius and John Winning of Appliances Online have also commented.

Phil Leahy, the founder of the Australian chapter of PeSA told he thinks Harvey’s comments are ridiculous and that there are opportunities for tax reform that does not involve lifting the $1,000 tax-free threshold.

“I think they’re just ridiculous [comments]. Just because we’ve got a dollar that has improved, all of a sudden…retailers are calling for protectionism via tax. Basically they want to keep the game insulated and prevent free trade,” said Leahy.

“It would have made sense when [retailers] were called upon 10 years ago to start investing in the [online] sector and start learning about how to trade online and be aggresive.

“I know it’s a bit difficult with the dollar the way it is, but [retailers] also have a thing called Austrade, which offers incentives and gives them rebates.”

According to Leahy, retailers need to “put some budget aside and start investing in online and learning about it instead of having their heads in the sand about it and all of sudden calling for protectionism”. He also said that bricks and mortar retailers need to have a better presence online, understand the space better and look to other markets to export “like the Americans are doing to us”, because “the dollar’s not going to be high forever".

Meanwhile, Millennius founder and CEO Pierre Boutros said, “Does Gerry Harvey think he is the only retailer in this world? As soon as something doesn't suit him he wants to change things because his business is suffering a loss.”

“All I can say is, ‘Welcome to business and competition’. If I had a say on some other issues as well, I would say that retail should not be able to have so much mark up on products and you will then see a lot of these retailers start dropping off,” said Boutros.

Appliances Online CEO John Winning has presented a more measured response to the debate saying that their offering has not been affected by the rising Australian dollar due to a unique business offering.

“Customers shopping with us receive our best price guarantee, next day delivery to metropolitan areas and same day delivery in selected areas. We also think we offer the best customer service of any appliance retailer whether they’re offline or online,” said Winning.

“Appliances Online has experienced growth of more than 100 per cent every year since I started the business five years ago – this continued through the Global Financial Crisis and has not been affected by the rising Australian dollar in the past few months.”

“Online retail in Australia is not yet at global standards – but it is increasing exponentially. The introduction of better broadband across Australia in the next few years will further fuel the growth of online shopping and we are excited to be a part of this dynamic industry.”

What do you think about online tax reform?

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