Australians may be banned from buying goods from eBay, if new “unworkable” GST changes go ahead.
eBay shoppers may be blocked from buying off overseas sellers, following changes to GST (goods and services tax) to be introduced on July 01, the US internet giant has warned.
The proposed changes will see goods sold online from offshore e-tailers worth under $1000 subject to a 10 per cent GST tax.
Previously, such internet purchases valued under the $1000 threshold escaped taxation from the Australian Taxation Office (ATO), but after a lengthy campaign from local bricks and mortar retailers, the exemption is to be lifted.
US-headquartered eBay says the plan is unworkable and complex.
‘Dark parts of internet’
In a submission to the Senate Economics Legislation Committee this week, the digital marketplace claims it may be forced to stop local users buying from non-Australian sellers and [the new GST rules] will reduce choice and competition.
“It is open to abuse by foreign companies, it exposes Australians to the risk of double taxation, it will reduce price competition and choice for all Australians who shop online, and it will drive online trade away from trusted, cooperating online marketplaces to the dark parts of internet,” eBay wrote in the submission.
The government’s legislation may also “force eBay to prevent Australians from buying from foreign sellers,” the e-commerce giant wrote. Fellow e-tailers including Etsy, Amazon and Asos are also against the proposed changes.
It would also “raise no revenue, deny Australians access to choice and lessen price competition,” eBay claims. “This solution would not even represent a win for bricks and mortar retailers, because Australians would still find ways to buy online.”
A 10 per cent GST tax is paid on most goods and services sold in Australia.
Goods sold via bricks and mortar retailers are subject to a similar 10 per cent levy, which local players including Harvey Norman, claims gives foreign e-tailers an unfair price advantage.