Australian Retailers Want Say In Customs Reforms

by Mary Swire, Tax-News.com, Hong Kong

02 March 2011

The Fair Imports Alliance, the coalition of retailer and wholesaler associations, has said that although it has consistently supported the customs compliance campaign, it has growing concerns about the lack of industry consultation regarding process, focus and timelines. The campaign was announced in December to crack down on businesses and individuals misusing importation regulations. These include parcels being imported under the threshold to later be sold in temporary 'pop-up' shops, false invoicing to avoid paying GST and lack of data about the size and scope of packages being imported.

Alliance spokesperson Brad Kitschke said: “On the surface it appears that Customs and Border Protection Service has not engaged in a serious examination of the issues and is not prepared to undertake the appropriate steps to establish a robust enforcement crackdown that might provide the appropriate data and intelligence on the full scope of issues the Fair Imports Alliance has raised”.

“The Alliance believes that information gathered from industry consultation must form part of the campaign. In addition, any forum that is held should occur in partnership with industry and due courtesy should be shown in terms of who is invited and the notice period. Being contacted about a forum by Customs and Border Protection with less than one week’s notice is not acceptable."

“The Fair Imports Alliance is the key group that lobbied the Government for reform and last year, through the Australian Sporting Goods Association, provided Minister Brendan O’Connor with a substantial paper about some of its concerns around enforcement of the GST threshold. To date, the department has chosen not to acknowledge this report or respond to it”.

To tackle this problem the government called for a Productivity Commission inquiry into the future of Australian retail, and the Commission has just announced the timetable for submissions. A paper will be issued at the end of March, initial submissions are due by May 20, a draft report will be published in August, public hearings will be in September and a final report will be presented to government in November. The Commission will examine the current structure, performance and efficiency of the retail sector and the drivers of structural change in the industry, including globalization, increasing household and business access to the digital economy, changing cost structures, employment issues and the exchange rate.

The Commission will also consider the issues posed by an increase in online purchasing by Australian consumers; the role online purchasing plays in providing consumers with greater choice, access and convenience; and the appropriateness of the current indirect tax arrangements for overseas online purchases.

“Fair Imports Alliance welcomes this announcement and invites interested industry associations to join and contribute to this process,” Kitschke said.

Bill Shorten, Assistant Treasurer, said earlier in the year: “We have made it clear that sustainability and appropriateness of the current tax settings will be considered, so any suggestion otherwise by retailers is unfounded."

“By cracking down on non-compliance and having a rational review of the facts, challenges and opportunities faced by the retail sector in Australia, we will help our retail sector to grow in a way that is globally competitive on prices and provides consumers with the choice and sophisticated product offerings they deserve”.

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