Road tax not to be subsumed under GST: Former CBEC Chairman

Faith Castro
April 19, 2017

Jooman Park, eBay Australia and New Zealand vice president, issued the warning through a submission to a senate inquiry into the "Amazon Tax".

The official said that most of the services where both VAT and service tax were levied would be fit around the standard rate of 18 per cent, while those on which only 12.5 per cent VAT was levied would be brought to 12 per cent. According to the company, it was unfair that it did all the heavy lifting so that third-party sellers using its platform could collect GST.

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It said since the term "e-commerce" covers all businesses where the supply of goods / services is through a digital or electronic network, there is a possibility of "unwarranted interpretations" which may lead to Future and Commodity Exchanges being treated as an electronic commerce operator in respect of commodity derivatives which result in actual delivery of the goods.

"A far more likely scenario is that the costs of compliance for one single country will outway [sic] any possible benefits for these internationally operating marketplaces, and it will, therefore, be less harmful to block imports altogether", Park wrote. However, in those cases the online "marketplace" is actually the real seller. However, eBay argue that it does not own, hold or distribute goods and not handle payments. Amazon said that it too supported a logistics-based model.

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Software companies will resort to quick fixes to comply with all required GST reporting, Rastogi said, since the challenge will be to build the IT infrastructure and customize it for each business. All parcels arrive at a small number of Customs points, via a small number of global logistics companies, one of which is government-owned.

"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", says eBay.

It captures all goods, regardless of whether they were purchased via a platform or from a "Unlike other proposals, this does level the playing field".

Asos also slammed the laws and claimed there would not be anywhere near enough time to implement and test any required changes to its operations. "We are concerned that if, complexity and uncertainty are not avoided, then compliance will be needlessly hard which could have a negative impact on both the success of the legislation and the Australian consumer", writes Carly Cazzolli, Asos head of trading for Australia and New Zealand.

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