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Australia removes e-commerce GST exemption

  • GST
  • 28 February 2017 | Richard Asquith

Australia removes e-commerce GST exemption

Australia has published plans to withdraw the 10% import GST exemption on the import of goods by consumers above AUS$1,000 from 1 July 2017.  The changes include supplies of e-services (downloads for games, video, music, app’s, e-books, cloud services etc) to consumers.

The change is targeting the purchase and import of consumer goods by Australians on foreign e-commerce websites, and aims to level the playing field for Australian market places which must charge GST on all sales.

Currently, where the seller is the importer of record, they may be required to register and charge GST once their sales to Australians exceeds AUS$75,000 per annum.  The new rules would mean any supply would be ‘connected to Australia’ and therefore subject to GST charge by the seller.  The AUS$75,000 threshold will apply to the sellers.

In addition to applying 10% GST to e-commerce, the new rules would also cover the provision of digital services to consumers by foreign marketplaces such as Apple iTunes, Google Play, Amazon, Skype, Netflix etc. The AUS$75,000 annual sales threshold would apply to registrations.

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VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.