Delays causing reseller woes

Delays causing reseller woes

An alleged bottleneck at the GST Start-Up Assistance Office has resellers fuming over lengthy delays in reimbursement of the Government's $200 certificates issued to nearly two million small businesses across the country.

The $200 GST Assistance certificates were issued to enable small businesses to purchase GST-related goods and services including accounting software, consulting, stationery, PCs and training to assist in the transition to the new tax system.

These certificates could be redeemed at any one of 10,000 registered supply companies, the majority being resellers, who in turn were to be reimbursed by the GST Start-Up Assistance Office, using an automated system, within 14 days of receipt.

However, many resellers have been left hanging in the breeze, alleging delays of up to several weeks are strangling companies' cash flow and placing pressure on their vendor relationships. But the GST Startup Assistance Office is convinced the problem doesn't exist.

At one point a reseller, who did not wish to be named, was owed $14,500, with some claims lodged as early as the end of May. Disappointed, the official line the reseller was given by a GST Start-Up Assistance Office employee was that the Office was facing "unprecedented demands".

"I was informed did not anticipate the huge demand. Why the hell not? They should know exactly how many claims there would be. They sent the damn things out in the first place," the resellers said.

Ian Grieves, manager of Toowoomba reseller Don Quixote Computers, feels like he's tilting at windmills trying to wrangle reimbursement for certificates amounting up to $11,000 from the GST Start-Up Assistance Office.

According to Grieves, they got a couple back within the 14 days but have still been waiting "several weeks" for a number of certificates, which he says is "pretty ridiculous".

"It takes your cash flow away from you. You can't turn around to your supplier and say ‘sorry I can't pay you right now'. If you're not one of the big box movers they'll cut you off.

"It hurts. The last six months have been the worst in 10 years," stated Grieves, citing the transition to the GST, delays in reimbursement and industry supply shortages. "All these things have hit at once."Another reseller encountering compensation problems is Graham Foster-Brown, managing director of Leading Edge Computers in Coffs Harbour. After lengthy delays and having to resend numerous certificates, Foster-Brown was astounded when, after finally managing to gain reassurance that his claims would be credited, was told the GST Start-Up Assistance Office system was down and he was going to have to wait longer. "The thing is, if you're a small business you can't afford to have that much money tied up," Foster-Brown said.

Established in August last year, the GST Start-Up Assistance Office was allocated $500 million to run the certificate and other programs and claims there have not been any documented cases of reimbursements blowing out beyond the 14-day turnaround period.

"There is no evidence of delays," Glen Carlos, project manager of the GST Start-Up Assistance Office, adamantly told ARN. "We have not had one single blowout out of 36,000 claims."Carlos claims around 300,000 certificates have so far been received by the GST Start-Up Assistance Office and suggests the onus lies with resellers filling out the application form correctly.

"We have had instances where people have sent in the wrong copy of the certificate and other mistakes," said Carlos. "It's not hard, but they have to get it right or else we can't process them.""We designed this program to give the little guys a slice of the [GST compliance] business. The last thing we want is a system that doesn't work. If you're having a problem give us a call," he added.

But resellers are not convinced by GST Start-Up Assistance Office assertions that there is no reimbursement bottleneck. As another reseller contacted by ARN eloquently put it: "That's bullshit."A major bone of contention for resellers is what appears to be a double-standards approach to the Government's taxation offices. A number who spoke to ARN said the ATO is quick to fine a company for a PAYE form lodged as little as a day late, but the GST Start-Up Assistance Office, in turn, is taking up to six weeks to reimburse businesses.

The up side

The carrot for suppliers to become registered was the incentive that their small business customers would have an extra $200 to spend on GST compliance products, services or training, and while many are experiencing reimbursement holdups, most resellers are happy about the amount of business the incentive is generating.

"I found people coming in with $200 vouchers, and 50 per cent of them were spending more than the voucher," Leading Edge's Foster-Brown said.

As a small business manager, Foster-Brown said he also received a $200 voucher but by the time he paid his staff nearly twice that to work overtime on the transition to the GST, as well as purchasing additional compliance products, it didn't go very far.

"It's been a successful exercise for us, and I suppose we shouldn't look a gift horse in the mouth," he said. "But after you've paid out everything for the [GST] transition, what is the $200 for? Is it to buy the beers after the event?"Although Don Quixote's Grieves agrees, most customers are definitely spending more than the voucher, and any benefit seems to "have been eroded" by the delays.

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