Australian retailers Myer and Harvey Norman are set to launch a Chinese-based website in a bid to help Australian customers avoid paying GST on sales.
Harvey Norman chairman, Gerry Harvey, told the website Channelnews that it was a “brilliant” idea to keep the company competitive with foreign sites that already give customers the GST break. While Mr Harvey did not announce a launch date for the new site, he did confirm it would be launched “shortly.”
This comes on the back of the announcement on Friday that the Myer department store group would launch a web site from Southern China. Myer chief executive Bernie Brookes says the company aims to have the website operational in February, Fairfax reports.
He said it was a case of "if we can't beat them, we'll join them", referring to its effort to counter the competitive threat from offshore websites. Mr Norman said that Harvey Norman may give Myer a run for its money, by launching before the department store giant.
“We may even beat Myer to getting out shop up,” he told Channelnews. “We may not make a lot of money, but it’s better than making no money at all.”
Mr Brookes reportedly told a business lunch in Melbourne the retailer was setting up the website due to a lack of action from the federal government over GST-free from shopping online for overseas goods. He says he wrote to Treasurer Wayne Swan last month about the tax issue, but had not received a reply.
A raft of retailers, including Harvey Norman, have complained they are losing out to foreign websites. Department store rival David Jones Ltd on Friday also threw its support behind calls for the government to make the $1,000 GST-free threshold for goods bought online from overseas retailers available also to Australian retailers.
"I'm not happy that Australian retailers are being put at a disadvantage," David Jones executive Paul Zahra said at the company's annual general meeting in Sydney. Mr Zahra said opening the GST-free threshold to Australian retailers would create a level playing field and allow them to compete with the international market. David Jones launched its online store on November 2, which Mr Zahra said had been "a great success".
"We are not competing on price, we are competing on convenience," he said. Mr Harvey said local retailers were at an "unfair disadvantage" in competing against goods bought from overseas websites.
Australians can buy online imports and not pay a goods and services tax (GST) for
products under $1,000.
"The fact that people say ... it is too hard - that is bulls**t", Mr Harvey said in a response to a question at the company's annual general meeting in Sydney last month. "Other countries do it. We can do it."
Mr Harvey said the federal government wasn't addressing the problem. "We have spoken to a number of politicians and their answer is 'it's too hard'," he said. "'It is too much to collect. We'll upset the voters because they vote for us'. "You are going to forgo about $1 billion in one year in tax, that is the GST they are going to lose in one year because this thing has escalated because of the parity."
The appreciation of the Australian dollar against the US currency has made buying overseas goods more attractive for domestic shoppers. |
