Industry body the Australian Retailers Association (ARA) has lashed out at the Australian Government, with claims the new budget will severely set retailers back.
According to the ARA, the Government’s Budget papers have included a subtle increase in the Import Processing Charge (IPC).
The ARA said the Government intends to restructure the IPC to recover the costs of import related cargo and trade functions.
The IPC for electronic sea import declarations will be increased by $102.60 to $152.60 per consignment and the IPC for electronic air import declarations will be increased by $81.90 to $122.10. These increases are set to become effective on January 1, 2014.
Commenting on the news, ARA executive director Russell Zimmerman said the increase in the IPC is just another blow to retailers’ confidence following a refusal from the Government to reduce the Low Value Import Threshold (LVIT).
“Given the Government has ignored
calls to reduce the LVIT on GST, matters have only been made worse
for retailers who have now been hit with yet another charge,” he
said.
“As retailers are aware, no cost recovery exists in
relation to consignments valued at $1,000 or less, even though today
there are in excess of 9 million consignments that fall within this
high volume low value process.
“The ARA believes that the
continued delays in reducing the threshold are impacting jobs as well
as State Government revenue.”
Zimmerman added that, according to the
Australian Traders Group (ATG), if a reduction to $20 in the
threshold from the current $1000 collection rate begins as soon as
the election is over, anywhere from $500,000 to $1 billion GST could
be collected in the 2014-15 financial year, rapidly growing to well
over $1 billion in the following few years..
“The ATG also
acknowledged the costs for collecting GST on overseas goods to be
significant, but with the work currently being undertaken by Customs
and Australia Post to reduce those costs, we are certain state
governments will be in a position to meet those costs, as they will
benefit from the extra revenue,” Zimmerman said.
The ARA was established in 1903 to represent Australia's retail sector.
The ATG was formed following the success of the Fair Imports Alliance (FIA), which ran a campaign to put the low value import threshold (LVIT) on the political agenda and convinced the Government to have the Productivity Commission look at the challenges faced by the retail sector.