Frustrated rural resellers face yet another challenge for survival as the Government's $200 GST Assist certificates issued to small businesses continue to cause apparent reimbursement dilemmas for many of the country's regional resellers.
As previously reported in ARN (July 19, 2000), the $200 GST Assist certificates were issued to enable small business to purchase GST-related goods and services including hardware, software, consulting and/or 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 reported delays of up to several weeks.
Furthermore, some resellers contacted by ARN are unwilling to speak out, for fear of what they claim could entice potential repercussions by Government taxation offices. Officials from the GST Start-Up Office, which issues the reimbursements, were not available for comment.
One small reseller servicing a town and an outer-laying rural area of nearly 8000 people, has submitted up to $12,000 worth of GST Assist vouchers but has received only $3200 to date.
"This claim that payments are made within 14 days is absolute rubbish. Six weeks would be closer to the mark, and we don't get told the payments have been paid into our bank. Originally we did, but that has ceased," the reseller told ARN.
"But then, we are talking to a Government department who have no concept of the real world or the retail industry, until you owe them money," the source said.
"It seriously affected our cashflow. As a small rural reseller, we have to pay upfront for all our [software] programs and most hardware purchases," the reseller added. "So far, I have had to get a temporary extension on my overdraft - which costs money and [attracts] higher interest - and borrowed from an investment I have just to fund the purchases."Another response from another reseller, this time on the NSW north coast, conceded the vouchers "have been good for getting customers through the door it", but this has been tempered by cashflow becoming "a thing of the past".
"We have had good sales pre-GST so it hasn't been too traumatic but things have slowed down this month [July], so cashflow might become a problem soon.
"We are only a small retail outlet but currently have about $8000 outstanding in vouchers."The average wait for recompense seems to be in the order of 4-6 weeks, according to complainants. This is "a far cry from the 14 days promised" our source bemoaned.
However, complaints about administration of the scheme are not just restricted to payment delays. Communication difficulties are also frustrating resellers.
"I have been very disappointed with the service. The ATO is difficult to get through to and rarely returns calls," one source emphasised.
In reaction to our initial story where the ATO denied extensive delays, resellers chose to disagree.
"I cannot believe they would dare to say they haven't been late with payments," a South Australian dealer replied. "We rang them in the closing days of June to tell them we had been waiting since the first week of May for payments. They were six weeks overdue and owed us nearly $14,000.
"They got one payment to us on June 26. Then we didn't get any more until July 17 and they still owe us a heap. What is so annoying about all this is that I will be expected to show [it] as income and pay tax on the $10,000 they still owed us on June 30."