Small retailers join online sales GST campaign

The National Retailers Association has joined the coalition of large retailers in the campaign to remove the tax-free threshold for goods bought from overseas online retailers.

Representing 3,700 small retailers, the Association has joined the retail giants in lobbying against the tax loophole, labeling it unfair and a threat to jobs.

NRA director Gary Black says the Australian community will pay an escalating price for the failure to address this “blatant inequity”.

“This price will result from GST lost, from duties and tariffs foregone, from customs fees and charges foregone,” Black says.

“From job losses, payroll tax revenue reductions, and the cost to the economy of inevitable business failures.”

NRA spokesperson Michael Lonie says many small members of the association feel they are suffering as a result of the tax-free threshold, indentifying businesses in food, books, household goods and the apparel sector as particularly hard hit.

“They’re the ones that are feeling the brunt… They’re very much reliant on what happens to wholesalers, and there’s no doubt that some of the wholesalers are feeling the pinch,” Lonie says.

Lonie says small retailers feel they don’t have a voice with regard to their inability to compete with online retailers amidst rising overhead costs.

“A lot of the smaller [operators] are paying rents, wages, etc. They’re not operating in the backyard or a tin shed, [unlike online retailers],” he says.

Meanwhile, a Westpac report shows retail sales fell by 1.1% in October despite expectations of a 0.4% rise.

Westpac states: “This was the biggest monthly decline since 2004 and came despite rising incomes, an extended pause in interest rates and upbeat sentiment.”

According to Westpac, several factors accounted for the fall including declines in small ticket discretionary items that may reflect switching to online purchases on imported goods, and price discounting.

“The last two factors will continue to weight on sales in November, with an added drag from rising interest rates,” it says.

According to ANZ, the value of retail sales is expected to increase modestly in November in seasonally adjusted terms.

“This will see trend monthly retail sales growth turn negative for the first time since the mid-cycle slowdown of 2000,” it says.