The Federal Government on Mon 3.12.2012, announced its interim response to the Low Value Parcel Processing Taskforce report. The work of the Taskforce followed the 2011 Productivity Commission (PC) report into the retail sector. The PC found that the low value threshold for GST and duty on imported goods was not the main factor affecting the international competitiveness of Australian retailers. It did find there were in-principle grounds to reduce the low value threshold, however it also concluded that it would not currently be cost-effective to do so without significant improvements in the efficiency of processing low value parcels.
As part of its response to the Taskforce, the Government has rejected calls for an immediate reduction in the threshold, but says it will begin preparing business cases and possible implementation plans for reforms to low value parcel processing. The Assistant Treasurer said a decision could not be made regarding the possible lowering of the threshold until these business cases and possible implementation plans for reforms to low value parcel processing have been prepared, and the costs associated with any possible changes have been determined. The Government also acknowledged that the current threshold of $1,000 at which GST is collected on low value parcels is “very high by international standards”.
Source: Assistant Treasurer’s press release, 3 December 2012
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