Dear Lifehacker, I am an enthusiastic Android user and I am looking at creating some Android apps to sell on the Play Store. I don’t plan to give up the day job, but instead develop some apps in my spare time. What are my tax implications? Do I need to register with the ATO? I’m also considering emigrating to be closer to my family in the next few years. What are the implications if I move countries? Would I need to de-register with the ATO then? Thanks, Forever Bamboozled By Tax
Agitation to “level the playing field” by imposing the Australian goods and services tax (GST) on most items we purchase online reached fever pitch last week with the release of the Low Value Parcel Processing Taskforce report, which recommended imposing the GST on all purchases worth $500 or more. But don’t panic: your Christmas shopping is safe for now.
It’s a line of argument that Gerry Harvey completely denuded of credibility: allegedly the main reason shoppers buy online is that the lack of GST on online purchases under $1000 makes them cheaper than local competitors. It takes about five seconds of work to demonstrate that that position is total rubbish, since the savings from overseas shopping on many products are way higher than the 10 per cent GST rate. So will anyone stand up to support it?
A National Retailers Association report last week suggested that thousands of Australian retail jobs will be lost because offshore shopping sites don’t have to pass on the 10 per cent GST required of local stores. However, it’s hard to square off that claim against the reality that goods purchased from overseas are often cheaper by a much larger margin. Here are seven examples (one for each day of the week).
As debate continues over the alleged impact of GST on online sales in Australia, eStore is offering a so-called “GST-free weekend” on January 15 and 16 to anyone using the code GSTFREE. Of course, it’s a 10% discount rather than an actual GST exclusion, but it serves to remind us that price competition is a possibility regardless of location. [eStore]
Large local retailers love to claimed that online shopping is unfair to them because overseas sales don’t attract GST for sub-$1,000 purchases, and they’ve even persuaded the Productivity Commission to examine the issue. SmartCompany has a well-put summary of why the arguments pushed by the big retailers are fundamentally wrong-headed.