If the Australian Taxation Office gets its way, soon you won't have to worry as much about your competitors rorting the tax system. Following the Treasurer's announcement in the recent budget, the ATO is seeking industry comment on a plan to change the Wholesale Sales Tax (WST) law so that tax is collected on all computer products, at all wholesale stages, redeemable only by buyers with legitimate reasons.
The ATO says the change won't mean fewer buyers who can legally claim sales tax exemption. It's meant to stop the middlemen and backyard computer dealers who manage to buy goodswithout a tax component, then on-sell them at an unfair price advantage.
The goods to be affected are basically all taxable products sold in the computer industry: printers; computers; monitors; peripherals; components; consumables and so on. Under the proposed system, which could be in law by the end of this year, each stage in the wholesale chain would have to levy the tax, claiming offsets for tax paid at the prior level.
The ATO plans to get refunds to exempt end users within 28 days of claim wherever possible, and would listen favourably to hardship cases such as where a charity buys computer gear.
The ATO admits that the proposed system would add a financial burden to some resellers who hold stock, but says the industry as a whole can only benefit from the move. The system is not intended to be permanent, but would revert to the existing system once the "evasion has been closed down".
Submissions on the proposal are welcomed from the industry.
The consultation document and further details can be obtained from the web site www.web australia.com.au/ato/wht/salestax/comptax/ contents.htm or by faxing Mike Cebalo of the ATO on (06) 216 1800.