The Australian Government Will Block Online Stores Not Collecting GST

Image: Getty

Under laws coming into effect as of next year, if it wants to, the Federal Government can block access to overseas retailer's websites if they aren't collecting GST — even for purchases under $1000.

Here's how.

Choice recently revealed the loophole, a part of regulations to be implemented as of July 2017. Overseas businesses will have to collect GST on everything if they have an Australian annual turnover of $75,000 or more.

Local retailers blaming losing sales to overseas sites prompted the change, which will see an extra $300 million in GST collected.

But how are the new rules going to be enforced anyway?

A Treasury Official told Choice that first, the Government will ask the businesses to comply. Failing that, the Government will fall back on treaty arrangements and international law to force them to comply. And if that doesn't work, as a "last resort", Government powers will be used to block the retailer's websites.

The Telecommunications Act gives the government the power to make telecommunications companies help enforce laws related to "[protecting] the public revenue".

So if you are buying items from overseas websites because you can't get those products locally, and those websites don't comply with our GST rules, you may find your path obscured by the heavy arm of the Government.


Comments

    I'm pretty sure in practice this legislation will be very lazily enforced.

      Rather it will be selectively enforced. You will find that retailers will drive the enforcement process by complaining to the government about online retailer A or online retailer B, which will then set a slow process in motion.

      Nah they are looking to payback favours for election donations.

    I assume they'll expect people to provide proof they've paid GST or something?

    "an Australian annual turnover of $75,000 or more."
    how are they going to work that out? Email the online retailers and ask them for stats of what they sold to Australians?

    Last edited 13/09/16 4:28 pm

      "Yeah, we sold $74,999 last year. Sorry."

      And that'll be it.

      If the government is serious about this, then they'd probably ask for proof under threat of blocking access to the site, or getting the business's local tax office to audit the books.

      This is a pretty big departure from the government Internet filter only being used to block child pornography ...

        Oh no blocking a site oh what will people from Aussie do. OH wait Proxies or a VPN. Same shit is happening here in NZ. I hate our countries more and more. If they reduced the fucking import tax and companies didn't raise the price by 20-50% extra then what it is worth then i would have no problem buying stuff from our stores.

        It is the same for bars etc complaining about less people drinking there and want bottle stores to stop selling booze because no one wants to pay $6-$10 for a stubby.

          It's not really about whether you personally can bypass such filtering: the simple fact is that a lot of people won't.

          So from the retailer's point of view, a large portion of their Australian customer base could just disappear. They then need to decide whether regaining those customers is worth the hassle of collecting GST.

          How does that help for physical goods? Next minit you have the added cost of a shipping forwarders, PLUS inflated prices for GST collection. All so some Aussie somewhere can comfortably charge 100% mark-up on a similar product you never wanted, while the item you want is never sold locally at all.

          Looking forward to this shit storm...

    aaaaaaaand VPN service for the win..

      Yep. I'm already happily VPNing the vast majority of my software purchases due to the Australia tax, although I guess that my aliexpress spending spree is sadly going to get a touch more expensive.

    I think I speak for most of Australia when I say "Garn git farked."

    is that AUD$75,000?

    Steam trades in USD, so this will be moot if so.

      Just means $75,000 AUD worth of goods sold to Australians. Doesn't matter if the currency is converted or not...just equivalent value in AUD.

      But they dont technically conduct business in australia, remember?
      http://www.kotaku.com.au/2016/03/why-valve-was-found-guilty-of-breaching-australian-consumer-law/

      Not that the digital games they sell constitutes as goods anyway (according to them)

        Yeah, it's an interesting argument. You'd have to argue that the rights conferred by the software licence are goods in and of themselves.

        If what Valve sells aren't "goods", then they would be "services". That would still be covered by the Goods and Services Tax.

    With the track record this government has with technology I don't think we need worry.

    facepalm.... it just gets worse and worse... innit

    Telecommunications Act = Lining the polly's back pockets act

    also most electronics/other retailers have shut down or been bought out here! this is not helping local retailers as there are none with the product... restrictions on products that can only be got overseas means restrictions on products fullstop.

    Last edited 13/09/16 4:52 pm

    I've actually started to find that some Aussie stores are quite competitive compared to overseas online stores. Not many, but it's a start.

      That'd be Plan B.

      They're just lucky that Plan A is starting to bear fruit, as this story shows.

      Oh yeah? I challenge you to name 3.

        For the stuff I usually order online:

        Games - Big W/Target certainly beats OzGameShop
        Cycling - BikeBug is competitive with Wiggle
        Toiletries - MensBiz is competitive with Strawberry.net

    Great, now I have to put time into finding ways around the blocks if the sites I buy from do get black listed.

    Also, Rae, what a photo. Yikes.

    Lot going on there.

      It was only on second glance that I realized it was Gerry Harvey. At first I couldn't understand why they'd used a pic from The Walking Dead on this article.

        Gerry Harvey's Monster. Gerry Harvey was only the doctor that collected the severed dead bits.

          Ah yeah, that one time Harvey actually thought Tara Reid may be considered a 'celebrity'...

          What a giant clusterfuck that was lol

    This will be about as successful as their online census.

    I'm a little concerned that this has come about due to the whole Steam/Valve vs Australia thing. With Valve refusing to offer local currency to Australia, you'll bet they're not paying GST. Imagine they'll be at the top of the Govt list.

    So if they block the Steam website, will that mean we can no longer sign into the client and play the games we already own, some of which could be purchased locally instore (ie, Fallout, Call of Duty)? Short of subscribing to a foreign VPN service.

    Or will Valve slap a further 10% on the already inflated sale price to accomodate for paying GST? I can't really see a good outcome here.

      ^This,

      The govt/big retailers will claim a victory, people who don't know/aren't informed will think its a good thing and the rest of us will pay the price....and so are the days of our lives!

      Steam was my immediate concern too, and I'm surprised it wasn't even mentioned in the article since I'm sure many readers share this concern.

      Does Valve/Steam have an Australian presence? I know you can buy US gift cards and games that integrate with Steam, but I'd assume that could be running through distributors. If Valve doesn't have an Australian presence it might be exempt from this anyway. I'm not sure Valve will have any issues.

      I'm not sure of the Impact for companies selling through Steam though who do trade locally or have local studios. I assume they'd be taxed.

    Wonder if they've stopped laughing at Apple and Google yet.

      What do you mean laughing at Apple & Google, did I miss something?

        Sorry. I meant if the people working at Apple and Google have stopped laughing at the Australian government yet.

    So instead of doing what the consumer has been asking for and consumer groups like Choice have researched time and time again; which is make local pricing more competitive with online options, our "smart" Government looks to put out a "Pay our Tax or we punish the consumer for coming to you" mandate which will only result in businesses either being locked out from Australians, or have them self-impose a ban on Australian consumers.

    Either way, the Australian consumer loses.

    To be fair on the government, speaking as the local retailer I am...
    ...

    Nope. This is still idiotic. The entire concept is idiotic.

    Yeah, good luck with that mate. You can't even scrounge up a decent NBN.

    So, would the Government consider popular torrent sites as "not collecting GST."
    Just wondering. My days of sailing the seven seas are far behind me, but I'm curious.

      isnt part of this scheme already to block pirate related sites?

      looking over the list according to wikkipedia they are blocking piracy related sites, restricted content (not only underage pornography but banned books/films/video games, sites talking about criminal activity and "hardcore" pornography), MA 15+ content that the government deems has insufficient access control software.

      Last edited 14/09/16 7:57 am

        Don't forget under Australian law things like vaginas with large labia, or squirting are "hardcore" and not suitable for Australian audiences.

          really? i was assuming they'd try to block most of the tube type sites because they usually have sexual violence (bondage type rough stuff) mixed in and that was on the list too but they consider that hardcore too?

            We live in a nanny state, and they've just snuck through nanny filter laws to potentially bring the internet in line care of Harvey Norman.

          Don't forget girls with A-cups

            Oh yea, technically if a girl "looks" underage, ie, flat chested petite and young face, it's child porn. Even if she's 21.

    If you were to look at the products that many of these large retailers sell, I'd imagine many are made outside Australia, probably China.

    Why should Australian consumers be compelled to 'buy local', if they don't seem to have much interest in doing so? Or is the free market only for corporations?

    Is this why Steam is no longer counting reviews from customers who activate steam keys?

    If steam has to charge GST, they're even less competitive with key sites.

      I imagine there might be a new grey market.... which is also in everybody's detriment

    Has anyone noticed how quiet Harvey has been on the matter since getting what he wanted?

    Fuck this pissed me off. I buy overseas because of a lack of choice and variety in Australia, as well as straight out price gouging. Then our cock hole government just go and do this.

    The are heaps a software products I buy from overseas (not just games) from small companies and indie devs. There is no way this can be enforced.

      only way i see it being enforced is as needed, like if a store complains they are losing business to a foreign site and the foreign site refuses to play ball with the government. Can't see them actively going after people unless there's actual issues from local stores.

        Yeah. Your probably right. One example of the kinds of software I get from OS is NetBalancer. Great utility but very niche in its application. I can't see anyone kicking up a stink.

        Last edited 14/09/16 9:01 am

    So they screw consumers over but keep letting large corporations (of which all the pollies are no doubt shareholders) get away with paying sweet F.A in tax? What a shady messed up world we live in.

      Feasability studies showed they would draw less tax revenue through taxing under $1000 than it would cost to manage. They're losing money in this program, not making it. Customs, Auspost, etc are all against it.

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