GST 20 years on – Australia leading the way on e-commerce

THE RECENT Organisation for Economic Cooperation and Development (OECD) Value Added Tax/Goods and Services Tax (GST) Global Forum hosted by the ATO in Melbourne displayed the leading role Australia is taking in adapting the GST to respond to the online marketplace, both within Australia and globally.

Deputy Commissioner Tim Dyce said latest revenue figures show that digital marketplaces and lower value international online sales were not an impossible nut to crack.

“The digital services measure has already achieved $272m GST in the first year or 180 percent ahead of forecast," Mr Dyce said.

"We’ve collected $81 million from the low value imported goods measure in the first three months of operation, already above our full year revenue estimate of $70 million. We’re tracking at over 300 percent of forecast.

 “There was a lot of discussion prior to their introduction about whether these kinds of measures could possibly work, and in many ways it is the most significant change in the way we have collected GST since its inception almost exactly 20 years ago.

“Thanks to the right consultation and design, led by Treasury along with the ATO, and with important input from business, the measures have clearly been effective, which shows we can provide a level playing field for online and physical businesses and between domestic and foreign businesses.

“Not only have we had high levels of registration for these measures and well above forecast revenue, we’ve even had feedback from some online sellers that the registration has improved their business processes and given them greater insight into their sales performance,” Mr Dyce said.

The ATO and OECD representatives welcomed officials from over 100 countries last week to the Global Forum to hear their views on a range of GST/VAT issues facing revenue authorities. The interest in our reforms from other countries means that the ATO can look forward to increased international cooperation as more jurisdictions follow this, or similar, models.

“I’d like to thank everyone, from across six continents, who came to talk about next steps last week” Mr Dyce said. "The ATO looks forward to working with both members of the OECD and non-members to build a system that is fit for purpose as we continue to see rapidly evolving and entirely new digital marketplaces.

“International cooperation across all aspects of tax administration remains one of the most important tools we have for ensuring everyone is paying the right amount of tax and that we are protecting honest businesses from unfair competition,” Mr Dyce said.

Further information on the GST measures and other advice on international tax for business is available on the ATO website.

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