Federal Parliament is currently considering changes to sales tax legislation which will tighten existing procedures for gaining exemptions as well as increase pressure on retailers themselves to resist tax free goods.
Mike Cebalo, the Australian Tax Office's (ATO) assistant commissioner, withholding taxes, says the price tag on goods when they reach their final point-of-sale is the best indication of whether tax has been paid or not. But the allure of the discount leads many dealers to aid and abet tax evasion.
While it is commonly known that sales tax fraud takes place at the last point-of-sale before the final sale to consumers, Cebalo believes that retailers are deliberately turning a blind eye. "Some large and well-known Australian companies are involved in tax fraud activities," Cebalo said.
Cebalo said that the ATO is pushing for a proper accreditation system; however, this appears unlikely to occur until March next year.
According to Michael Bosnar, general manager at Prion Technology Distribution, the new system is likely to be very "paperwork intensive" with many checks and cross checks.
Papers currently under parliamentary review estimate that sales tax evasion on computer hardware costs the Australian Government $80 million a year.