Page 28 - Toy & Hobbby Retailer Magazine Nov-Dec 2018

RETAILER PERSPECTIVE
IMPORT ISSUE
The long haul
Australian businesses have been battling to have the $1000 import threshold scrapped for several years. Hobby retailers, Brian Simpson and Colin Scott, explain and explore the problem, as well as what they’ve been doing to combat it.
IN 2004, Toy & Hobby Retailer ran an article written by Colin Scott, managing director of Frontline Hobbies, about the import threshold and how this was disadvantaging Australian businesses in the toy and hobby industry.
Since then, he, Brian Simpson from Perth RC Models and Hobbies and a group of other businesses from varying sectors have been campaigning the government, business associations and other bodies
to scrap the import threshold, to level the playing field for Australian businesses.
In the year 2000 the Howard Government introduced the GST. At that time, very few people purchased products online from overseas as there were issues with fraud, credit card scams and the delivery of the wrong goods.
The government then set the import threshold at $1000, up from $400, before any customs handling fees of $55 then – now $90 – any duty (if applicable) and any GST, would apply.
Over the years, since the $1000 threshold was set, online shopping from overseas vendors has become more secure and far more prevalent.
It has become cheaper for the Australian consumer to buy from overseas companies rather than supporting local businesses. Even if Aussie businesses did buy at the same price from overseas, they have to add customs
fees between 20 and 30 per cent, a profit margin and the GST, which makes them uncompetitive immediately.
As toy and hobby businesses generally purchase several items for their stock, the total invoice values are often more than $1000. This means that we have to pay the customs handling fees, any duty if applicable and the GST on top of that. Ultimately, we
simply can’t compete against a private citizen buying a few items under the total invoice value of $1000.
With this threshold in place, it didn’t take long for some overseas companies to realise that the Australian Government didn’t have a matching system in place that would match the amount actually paid against the amount on the invoice.
Because of this, for years, some offshore businesses have been – for those who are purchasing goods over $1000 – writing false invoices for an amount less than a $1000, so that the customer could escape all the Australian import fees and the GST. All of the government departments and the politicians know of this and do nothing about it.
Above: An excerpt from the offshore RC711 hobby product website. 28 TOY & HOBBY RETAILER NOVEMBER / DECEMBER 2018
Notes:
- We will declare the parcel as toy hobby model kit at value of around US$145. Usually can aviod high customs taxes. - RC711 reserves the final decision to ship or refund the order. Thanks for your understanding.