Australia extends tax to foreign eCommerce

LinkedIn Twitter Facebook

 

Author: Richard Asquith, VP Global Indirect Tax, Avalara

Australia is set to draw non-resident eCommerce businesses into its 10% Goods & Services Tax (GST), starting 1 July 2017. The changes to the Australian GST regime will bring it into line many other tax authorities around the world who are seeking to ensure they gain their share of tax revenues from the burgeoning cross-border online shopping market.

GST on e-services

From July 2017 forward, sales of electronic services by foreign providers to Australian consumers will be liable to a 10% GST. These services include: streaming video, music and gaming; e-books; downloads or cloud-based software; subscriptions to membership or news websites; mobile phone apps; and online education.

 

The extension of GST to non-resident providers will require them to GST-register with the Australian Tax Office (ATO) once they exceed the registration threshold of AUS $75,000 per annum. Once registered, providers will be obliged to submit quarterly GST returns to the ATO, declaring all sales and applicable tax.

 

In the case of services and apps sold through an online distribution platform, such as Google Play and Apple iTunes, the platform is responsible for charging and reporting the GST.

 

The Australian e-services tax reforms bring it into line with similar changes over the past two years in the EU, South Africa, South Korea, Japan and New Zealand. Many other countries are expected for follow suit in the next 12 months.

Cross-Border eCommerce in Australia Tax Laws

Abolishing the GST-free threshold on foreign online sales

In addition to the changes on e-services, the ATO is making more foreign eCommerce goods transactions with consumers liable to GST. It is scraping the current GST-free threshold of AUS $1,000 per package, and making all arrivals of goods from foreign eCommerce providers potentially liable to 10% GST.

 

As with the new e-services rules, the AUS $75,000 GST registration threshold will apply. This will mean that possibly fewer than 100 offshore online retailers will be forced to GST-register and file quarterly returns. The vast majority of small eCommerce sellers will still be able to sell GST-free.

 

 

For more information, please consult our Australia cross-border eCommerce country guide.

LinkedIn Twitter Facebook

Delivery preference of Dutch and Belgian online shoppers

Delivery preference of Dutch and Belgian online shoppers

Dutch and Belgian consumers are increasingly buying their goods online, but they differ in how they want those goods delivered. A savvy online retailer needs to localise its delivery options to meet these local requirements. But what are these delivery preferences?
The fundamentals of retail: Which European countries are leading the way?

The fundamentals of retail: Which European countries are leading the way?

From delivering on promise, to quickly resolving contact centre queries, to minimising the amount of returns, there are myriad aspects for retailers to get right when it comes to delivering a great customer experience. But which European countries are most successfully delivering on the fundamentals of retail?
Beyond Black Friday: Unmissable international events for 2017 eCommerce plans

Beyond Black Friday: Unmissable international events for 2017 eCommerce plans

In the US, the day after Thanksgiving has been a key focus for US shopping. Now, Black Friday is becoming the unofficial start to the Christmas shopping season in countries across the world. But there are hundreds of other events across the world to be aware of when developing an international strategy. Here are a few...
How UK retailers use localisation to succeed in Asia

How UK retailers use localisation to succeed in Asia

Expansion into Asia can be a natural next step for a successful business and with UK brands such as Burberry, The Body Shop and Lush having all had huge international success, what can we learn from these brands?
Why international e-tailers should re-visit the top of the funnel

Why international e-tailers should re-visit the top of the funnel

The role of brand awareness is increasingly critical to international expansion and with various platforms offering better reach and targeting than ever before, why is it important for international retailers to revisit the top of the funnel to help create a more compelling picture?
‘Your Global Consumer Isn’t Who You Think She Is’ - An Interview with Kai Li from Revolve Clothing

‘Your Global Consumer Isn’t Who You Think She Is’ - An Interview with Kai Li from Revolve Clothing

Kai Li, Vice President of International for Revolve Clothing, took part in an insightful Q&A session and shared his approach to expanding businesses into new Countries and why identifying his business’s value proposition in those countries is critical.
Black Friday growing strongly in Brazil

Black Friday growing strongly in Brazil

The phenomenal performance of Black Friday rippled around the world and Brazil was no different with eCommerce Brasil reporting billions in sales. So what are the figures coming out of Brasil on this bargain-hunting shopping day?
eCommerce in Brazil: Going local is key

eCommerce in Brazil: Going local is key

As with anywhere, Brazil has its fair share of problems – but with a population of 200 million, a tech-savvy and consumption-driven middle class and arguably the most internet-connected population in the world, is Brazil seen as a necessary evil for international merchants looking to expand internationally?
Quality of delivery offer important to Dutch shoppers

Quality of delivery offer important to Dutch shoppers

Cross-border eCommerce in Belgium and the Netherlands is making big strides and with a population of 28 million people and combined GDP of €1.08trn and English spoken widely, it’s no wonder it offers an attractive market to international merchants looking to expand into new territories. But does the quality of delivery offered that important to Dutch shoppers?
How to maximise your chances of success in India

How to maximise your chances of success in India

eCommerce is growing at an unprecedented rate in India thanks to a number of factors and with the percentage of online retail sales growing rapidly, what do retailers need to consider in order to maximise their chances of success in India?

Contact Us

eCommerce Worldwide
2 Ching Court
49-53 Monmouth St
London
WC2H 9EY

Tel: 0203 696 0980
2016© eCommerce Worldwide

Keep In Touch

powered by Affino

About eCommerce Worldwide

eCommerce Worldwide provides online retailers with all the information, and resources, they need to develop cross-border strategies for entering new markets around the world
Read More