Can anyone explain to me what customs/duty fees are for?
I am planning on buying two shirts and a tie from a US company for my partner for Xmas, but have been told (by the Australian Customs Dept.) that the following charges will apply:
So I’m spending about USD60 (before shipping), then will have to pay 25% on top, plus GST on THAT + transport. That’s a fair chuck of Aussie dollars for a couple of items of clothing.
Can anyone explain the justification for this, as to me it just looks like highway robbery without any valid reason.
I can understand applying duty/tariffs/fees to business importers, but a private purchase of a coupla measly shirts? Why?
Is it really that mysterious? The theory is, to make imported goods more expensive, motivating you to buy local products. Actually it shelters local producers from real competition and makes them inefficient, but that’s harder to sell to the voters and workers.
There are subsidiary reasons, of course. In this case:
(a) The GST is imposed because, if the shirt were made and sold in Australia, you would pay GST, and if it were made outside Australia, imported and then sold to you, you would pay GST. The Feds see no reason to give you a free pass just because you are buying the shirt and importing it yourself. And you can see why Australian manufacturers and retailers would be mightily pissed off if Joe Public could avoid GST by doing business directly with foreign manufacturers and retailers.
(b) The import duty is imposed, I guess, to protect Australian clothing manufacturer, or possibly Australian cotton growers, or possibly both. Again, there’s no logic to imposing import duty on wholesale imports but not on retail imports; the only effect of that would be to put Australian distributors and retailers at a competitive disadvantage to their overseas counterparts, and why would the Feds want to do that?
In short, AndrewT is crrect about the import duty but wrong about the GST.
The only argument for exempting private imports from duty and GST is that it might cost more to collect the taxes than the taxes would yield. But even then there’s an argument that the taxes should be collected anyway, to avoid distorting Australian consumers preferences by offering them an incentive to buy from foreign retailers. The Australian retailers would certainly make that argument very strongly. And who’s little Johnny going to listen to; Coles-Myers or you?
Thanks Andrew & UDS. I was hoping there was some extremely reasonable ethical justification for it, that would make me feel I should do the “right” thing. Guess not.
If that’s the justifitcation, why is there no exemption for products that *aren’t * available locally? Because they don’t have to.
Honestly, with the exchange rate, cost of international shipping, risk associated with international purchase if a problem occurs, length of time in transit, etc, I think most people would buy locally if that option existed.
Bummer, I may have to rethink a few Xmas gifts
(BTW, I have no problem with the GST component, as the shirts and books I had in mind would attract GST if purchased here. It was more the import duty fee I was objecting to)
I did not see any exemption on the Customs website, and when I questioned the Customs Representative about the duty that would apply to the import of two shirts and one tie as a gift, nothing was mentioned.
If you have any details about these exemptions, please let me know. As I said, I’m happy (well, as happy as you can be when paying taxes!) to pay the GST on the goods, but am unhappy with the customs fees.
Obviously shirts and ties are made locally. The specific style of shirt and tie I wish to purchase isn’t, but it’s clear to me that that isn’t relevant, as far as Customs are concerned.
Thanks to all who assisted. Question asked and answered.