Andrew Leigh

CHRIS BOWEN MP

SHADOW TREASURER

MEMBER FOR MCMAHON

ANDREW LEIGH MP

SHADOW ASSISTANT TREASURER

SHADOW MINISTER FOR COMPETITION AND PRODUCTIVITY

SHADOW MINISTER FOR CHARITIES AND NOT-FOR-PROFITS

SHADOW MINISTER FOR TRADE IN SERVICES

MEMBER FOR FENNER

SENATOR CHRIS KETTER

CHAIR, SENATE ECONOMICS REFERENCES COMMITTEE

SENATOR FOR QUEENSLAND

LABOR CALLS FOR DELAY TO GST ON LOW-VALUE IMPORTS

Following revelations the proposed GST on low-value imports may be unenforceable and cause major disruptions for families and small businesses, Labor today calls on the Turnbull Government to delay its implementation for one year, until 1 July 2018.

Labor has supported the removal of GST on low-value imports with a feasible model, and remains supportive in principle. The bipartisan hand has always been extended to the Government to work constructively on this measure.

But today’s hearing found the Turnbull Government has botched its implementation, with Treasury admitting the lack of a Regulation Impact Statement was in breach of the Office of Best Practice Guidelines.

The Australian Taxation Office, lumbered with a vague plan by the Government, were left to explain that jurisdictions like the USA and China will not enforce the measure on their behalf. Platform compliance is largely reliant on the goodwill of overseas operators.

eBay claimed that Treasury officials had told them they expect a 25-30% compliance rate.

Affected retailers raised questions on how platforms (and the independent sellers who use them) would interpret Australia’s unique GST regime and its exemptions.

When asked by Senator Chris Ketter about economic modelling and consultations on alternative models, Treasury and Australian Tax Office officials were left in the awkward position of defending the Scott Morrison’s decision to legislate the ‘vendor-based’ model.

Treasury officials declined to answer questions about whether alternative start dates had been modelled. The measure is due to take effect in just over two months’ time. Yet witnesses – from the Australian Taxation Office to online retailers – all raised more questions than answers on how the measure will be implemented and enforced in overseas jurisdictions.

Both the Conference of Asia Pacific Express Carriers and the Freight and Trade Alliance called for a 12-month delay.

Today’s public hearings clearly show that Scott Morrison has failed to properly consult with stakeholders and develop a workable model for taxing low-value imports.

Scott Morrison likes to talk about reducing the impact of red tape, yet in this case he has failed to produce a Regulation Impact Statement, as the Office of Best Practice Regulation guidelines recommends.

As such, Labor is calling on the Government to:

• Delay the start date to 1 July 2018
• Engage with all stakeholders and review alternative models
• Deliver a Regulation Impact Statement to assure small businesses and consumers that the measure will operate as intended.

Applying GST to imports valued at less than $1,000 has Labor’s in principle support. But Scott Morrison must show that his preferred model is workable and enforceable.

Too many stakeholders now have concerns about the Treasurer’s ability to implement this measure without it severely disrupting this important and fast-growing part of our economy.

FRIDAY, 21 APRIL 2017