Australian GST to change for Low Value Goods below AUD 1,000 as of 1 July 2018

Australian GST to change for Low Value Goods below AUD 1,000 as of 1 July 2018

Please take note of the below changes in regulations affecting customers shipping to Australia.

The Treasury Laws Amendment (GST Low Value Goods) Bill 2017 was passed in Australian parliament on 21 June, 2017. From 1 July 2018, Australian goods and services tax (GST) will apply to sales of low value goods imported by consumers into Australia.

Impact on FastShip customers exporting to Australia

These changes mean that, as of 1 July 2018, customers who generate more than AUD 75,000 in gross sales revenue per annual from Australia, will need to register for the Australian goods and services tax (GST) and charge this at point of sale. Customers may include online shopping platforms, independent merchants and mailbox re-delivery service providers.

This will apply to low value consumer goods when sold and shipped in consignments AUD 1,000 or less.

Customers who meet the AUD 75,000 threshold are required to:

  • Register with the Australian Taxation Office (ATO) via this link. Once registered, businesses will receive an ATO Reference Number (ARN).
  • Charge and collect GST on sales of low value goods to Australian consumers.
  • Lodge GST returns to the ATO periodically.

Once a business has obtained an ARN, they will be required to provide this number to salesperson or Customer Service of FastShip.

Customers who sell through marketplaces, registering for an ARN is not necessarily required as the marketplace is responsible to collect GST at the point of payment for low value goods. If customers are unsure if they should register for an ARN, they should contact the ATO or refer to the information on the ATO website.

Businesses that are treated as the supplier of low value goods for GST purposes (such as marketplaces) and are registered for GST, are legally required to ensure that relevant tax information is included on the customs documents for low value goods.

At this juncture, there are no foreseen changes or delays to customs clearance and FastShip will monitor the situation closely.

The import threshold of AUD 1,000 remains in place and goods in a consignment over this amount will be subject to normal border reporting, duty and tax collection processes. This means that customs duty continues to be exempted for shipments under this threshold, and specifically B2B imports will continue to be GST exempt.

For more information on the changes, exemptions, and how businesses can register for an ARN, visit the ATO website. Once again, we would like to highlight that the Australian Government will take action against businesses who do not meet their GST obligations. You can also contact the ATO via email at AustraliaGST@ato.gov.au or directly on +61 2 6216 1111 between 8.00am to 5.00pm (UTC+10:00), Monday to Friday.