Australian GST on ebook from overseas.

[RCR]

Maybe an Australian on the forum can help me. I've just bought an ebook from a South African supplier. I used Paypal(Australia) and the bill included Australian GST. I clicked on PAY because the amount of GST was small.

I'm wondering about whether or not the GST should be there. I've googled around and can't find a straight answer.

I've bought real books and ebooks from Amazon(USA) and Amazon(UK) for many years. I've also bought real products from other overseas companies. I have used both credit cards and Paypal to do this. I've never been charged GST before.

I've sent a query to the company but haven't received a response yet.

Can anyone tell me.....

* Is it the South African company charging GST or Paypal (Australia) doing it?

* Should they be doing it?

[Yapyap]

As a European, I can't say about Australian GST, but Amazon.com does charge VAT on Kindle books. It's just that on Amazon, the VAT is already included in the price displayed to you and charged from you when you're logged in.

Kobo on the other hand displays me a "base price" and adds the Estonian VAT (20% on ebooks) on the actual purchase page to get the final price. (I think Kobo's price display depends on the country; my German and French friends says that they see the final price in euros already on the book page and it doesn't change between the book page and purchase page, while I see the price in USD instead of euros both on the book page and purchase page and the VAT is added to the initially displayed price.)

BooksOnBoard, as far as I can tell, does not add local VAT at least for me. I don't know whether they do it for other countries.

So based on my experiences, I'd say that it's likely the South African company (not PayPal) that charges GST and it's equally likely, at least in theory, that they pay it on to whatever authority in Australia collects GST; at least I think this is what the companies that do charge local taxes from foreign customers are supposed to do with the collected extra tax money.

[DarkScribe]

We (at the moment - there is a push to change this) don't pay GST on online purchases under one thousand Australian dollars. I have no idea why you were charged this amount - I use PayPal almost daily and have never been charged GST for overseas purchases.

[Yapyap]

Hmm, I wonder if ebooks are somehow in a different category?

Out of curiosity, do Australians pay the base price on self-published books costing $0.99, $2.99 etc on Amazon or are those prices slightly higher for you? (I'm taking self-published books as an example here as trad-pubbed books can and do cost different amounts for people in different countries due to the publisher setting different prices, so any price differences between, say, US and European/Australian/etc prices can't be automatically considered to be just taxes.)

[DarkScribe]

Originally Posted by Yapyap

Hmm, I wonder if ebooks are somehow in a different category?

Out of curiosity, do Australians pay the base price on self-published books costing $0.99, $2.99 etc on Amazon or are those prices slightly higher for you? (I'm taking self-published books as an example here as trad-pubbed books can and do cost different amounts for people in different countries due to the publisher setting different prices, so any price differences between, say, US and European/Australian/etc prices can't be automatically considered to be just taxes.)

No, eBooks are not in a separate category, it applies - by Federal law - to all purchases. One of the reasons is that it is simply too difficult to enforce collection on small amounts; the cost to the government would be higher than the gain. As for pricing, yes we do pay a premium, something that applies to purchases from Amazon, Apple, Microsoft etc. This is currently also something that is being examined by a government board. These companies have been asked to show cause as to why they charge more.

[stepberr]

I think Darkscribe that you are mistaking Imports for Exports.The $1,000 rule only applies to Imports to Australia,Exports from Australia are charged at the standard rate regardless of size.

[DarkScribe]

No, I am not mistaking anything. Exports are not under discussion. It applies to anything purchased online, by an Australian. Most of my purchases are under the cut-off point. A week or so back I purchased a new copy of Adobe CS6. That was over the cut-off and was paid through PayPal. Even then it did not attract a GST component, BUT the form attached by Australian Customs did point out that I was obligated to either pay the GST or provide the appropriate ABN registered for GST. The issue has attracted a lot of attention particularly since Gerry Harvey started crying into his profit and loss statements.

[Yapyap]

Could it be though that the same reasoning applies to taxing ebooks as to geo-restricting ebooks, i.e. that the point of sales for the ebook is considered to be the buyer's location, not the seller's (unlike almost any other online purchase from abroad)?

And if it is so, then buying an ebook from a foreign shop wouldn't be considered importing?

[DarkScribe]

Originally Posted by Yapyap

Could it be though that the same reasoning applies to taxing ebooks as to geo-restricting ebooks, i.e. that the point of sales for the ebook is considered to be the buyer's location, not the seller's (unlike almost any other online purchase from abroad)?

And if it is so, then buying an ebook from a foreign shop wouldn't be considered importing?

No, the Australian Tax Office has no interest in the location of the goods being purchased, just in the location of the purchaser and the funds that purchaser uses. If GST is applicable it makes no difference as to the point of origin of the goods. Any local taxes are a matter to be resolved between the purchaser, the seller, and the entity controlling taxes in that country or state.

[AlexBell]

I can only speak from personal experience; I have no idea what the law is or why a book bought from a South African country should be charged Australian GST.

When I buy ebooks from Kobo in Canada I'm not charged GST. When I buy ebooks from eBook.com in Australia I am charged GST.

[sabredog]

Originally Posted by DarkScribe

We (at the moment - there is a push to change this) don't pay GST on online purchases under one thousand Australian dollars. I have no idea why you were charged this amount - I use PayPal almost daily and have never been charged GST for overseas purchases.

Exactly correct. Australians do not pay ANY GST on items under AU$1000 purchased overseas.

Like DarkScribe, in 13 years of buying overseas, I have never been charged GST and I shop mainly with Amazon, online hobbyshops and eBay.

I seem to recall reading that there was a business front end attempting to encourage/bribe overseas sellers to charge more for Australians buying online but the ACCC got wind of it.