By Patrick Avenell
The industry response to yesterday’s draft release of the Productivity Commission’s (PC) report into retail has been mostly positive, with retail groups happy that the report recommends lowering the GST threshold on imported goods.
Brad Kitschke from Fair Imports Alliance, the lobby group formed to achieve a reduction from the current $1,000 threshold, applauded the recommendation, while criticising perceived inefficiencies with Australian Customs.
“The recommendation by the PC that there are in principle grounds for the threshold to be lowered is great news for retail,” he said. “We’re not surprised Customs has come under fire for its inefficiency. However, retailers shouldn’t be punished because the bureaucracy is inefficient. We need speedy action.
“Retailers are embracing online retail, and more and more Australian retailers are engaging in a multi-channel approach.
“The PC’s draft report has made it clear that inefficient parcel processing through Customs must be improved as it is the sticking point to allow for the low value importation threshold to be changed. This must happen as soon as possible.”
Russell Zimmerman from the Australian Retailers Association (ARA) welcomed many of the recommendations, whilst still maintaining his downbeat tone for the future of retail. Zimmerman’s focus was on the property recommendations made by the PC.
“As retailers struggle with poor trading conditions, skyrocketing rents are driving many businesses into the ground,” preached Zimmerman.
“The ARA welcomes the PC’s acknowledgement that planning and zoning restrictions are propagating the power imbalance between landlords and retailers at the negotiation table.
“The ARA also supports recommendations for a harmonisation of lease information and nationally consistent model legislation, as well as voluntary national code of conduct for shopping centre leases that is enforceable by the ACCC.
“The ARA is disappointed there is no further recommendations for third party reporting of turnovers to avoid abuse of predatory negotiations from landlords nor a national registration of retail leases as suggested in ARA’s submission.”
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Over at the National Retail Association (NRA), executive director Gary Black warned that 80,000 jobs were at risk if the Government didn’t act fast.
“While the Commission makes significant mention of the ‘deadweight’ cost of collecting GST and other import charges on low value items, it has completely ignored the cost of doing nothing,” Black said.
“The cost of inaction on this issue will be widespread business failure, and around 80,000 Australian jobs moving offshore. This would in turn result in substantially lower business and personal tax receipts, and falling GST collection.
“The NRA believes these costs must be weighed against the estimated compliance costs associated with collecting the GST, import duty and customs charges for low-value imports.”