Government ‘turning a blind eye’ to online tax: Retravision

By Keri Algar

SYDNEY, NSW: Retravision Southern CEO has told Current.com.au that he "absolutely agrees" with Gerry Harvey’s call for tax on goods bought on foreign websites.

As it stands, the 10 per cent goods and services tax doesn’t apply to imported goods purchased for under $1,000, an arrangement Harvey has said is hurting retailers during a period of a strong Australian dollar, and that this is being ignored by the Government.

Retravision Southern CEO Tim Cockayne said that the majority of online business is for purchases under the $1,000 mark, resulting in a challenging situation for the Australian retail sector.

“I totally agree with Gerry. Absolutely agree,” said Cockayne.

“We do know that approximately…20 per cent of our online business goes overseas. [Overseas online retailers] do have that advantage in that they don’t have to pay the tax for those amounts, and that’s the majority of online business, below $1,000.”

Fifty-four per cent of Australians spent less than $1,000 on online purchases in the last 6 months, according to research from the Australian Communications and Media Authority released earlier this month. Thrity-seven per cent of purchases were for household goods such as furniture, electrical appliances, and computer equipment.

“It affects the bricks and mortar retailer, the bricks and mortar retailer who has to pay rent, pay staff, pay company taxes, pay Local, State and Federal Government taxes, they also have to pay GST and then somebody from overseas, due to the thriving Australian dollar, can basically come in here sell a product, just take the profit straight off and leave nothing behind.

“Gerry has got a very strong voice in regard to this and he speaks for the majority of the sector. We fully agree with what he’s saying and the government seems to be turning a blind eye.”

What would you like to see the online tax threshold reduced to? kalgar@intermedia.com.au

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