The Treasury Laws Amendment (GST Low Value Goods) Bill 2017 was passed into law in June 2017 amending the Goods and Services Tax (GST) law to give effect to the 2016-17 Budget decision to apply GST to low value (under $1,000) goods imported by consumers.
Businesses treated as the suppliers of these goods will need to register with the Australian Taxation Office (ATO), collect GST at the point of sale and remit that GST to the ATO. As this is a tax measure and not a border measure, the ATO is responsible for implementation and all compliance activity.
The AUD1000 threshold for GST, duty and reporting at the border will remain, and there will be no changes to current border clearance processes. The changes will also not impact the flow of goods across the border. While border processes will not change, the Department of Home Affairs advises you to consider whether changes to your business processes are necessary.
The ‘vendor model’ requires the on-line vendor to be responsible for the collection and remittance of the GST.
How will the Vendor Model work?
Vendors registered for GST need to ensure that relevant tax information is included on import documents for low value goods. Vendors can face penalties if they fail to take reasonable steps to meet their reporting requirements.
Businesses that are treated as the supplier for GST purposes and may need to register will be: – the operator of the electronic distribution platform (EDP) through which the goods are sold – the merchant who sell the goods
– the re-deliverer who helps to bring the goods to Australia.
To help vendors meet their reporting requirements, the Integrated Cargo System will allow, where necessary, the reporting of additional information, including Vendor ID, Importer ID and the use of a GST-paid exemption code. Providing the additional information, particularly the GST-paid exemption code, helps prevent GST from being charged at the border when it has already been charged at the point of sale. If GST is charged a second time at the border, refunds will not be available from the Department of Home Affairs and must be sought from the supplier.
For more information from the official DoHA source of this article, CLICK HERE
