Low Value Imports

The Australian government has now released the draft legislation abolishing the low value threshold for goods imported into Australia.

2017-02-16

The Australian government have now released the draft legislation abolishing the low value threshold for goods imported into Australia.

The current position whereby goods imported into Australia with a customs value that does not exceed $1,000 are not subject to GST is being abolished with effect from 1 July 2017. From that date all supplies of goods to Australia are potentially subject to GST at 10%.

The ‘vendor registration’ model adopted in the legislation means that the GST on supplies of goods for less than $1,000 delivered to Australian consumers will need to be accounted for by either:

  • The overseas supplier if the total value of goods supplied to Australia is greater than AUD$75,000 per year; or

  • The entity delivering the goods (the goods forwarder); or

  • The “Electronic Distribution Platform” where the goods are ordered over that platform.

Australia is the first country to try and collect GST in this way and has tried to align the approach to the taxation of imported services which is also being introduced with effect from 1 July 2017. Unfortunately this has meant that the draft legislation is very complex and is in some instances considered unenforceable.

If a business supplies delivered goods to Australian consumers, the changes need to be carefully considered in advance.

If you would like any further information please contact Andrew Nutman.

Andrew Nutman
Associate Director, Tax
ShineWing Australia
T +61 3 8635 1981 
E anutman@shinewing.com.au