What effect does the new tax system have on importing?
From 1 July 2000, the Wholesales Sales Tax (sales tax) system was replaced by a broad based Goods and Services Tax (GST). Under the former sales tax system, there were several different tax rates which were applied depending on the nature of the goods. In addition, the application of sales tax was not universal, with broad categories of goods being exempt. Under the GST, with few exceptions, a flat rate of 10% is applied to all goods and services. Some examples of goods exempt from GST are certain basic foodstuffs and certain medical aids and appliances. While the introduction of GST has no effect on the determination of an importer’s Customs duty liability, significant changes occur to the rate, method of calculation and applicability of other taxes. From 1 July 2000, with very few exceptions, all imported goods are subject to GST. For advice on any tax issues contact the Australia Taxation Office, preferably before goods are imported. GST Calculation As with sales tax, the first step
