Questions about purchasing bicycles and parts
Collecting all of these points I will assume that a solution in the near future (in the eyes of business) is not realistic so the best approach would be to understand what is happening and adapt.
One bike shop owner I spoke to recognised the competition of overseas shops on some of his stock, he reduced that stock and concentrated on items that are harder to get from OS shops.
Last edited by AUbicycles on Mon Apr 04, 2011 7:08 am, edited 1 time in total.
Reason: corrected spelling
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I would also like to add another reason why many others may shop online from my own experience. I have a disabled brother and for him to load up the car with a gopher/walking frames then go to a shop or shopping complex along with finding a disabled car park that isn't being used is very hard. Most shops don't cater for the disabled as the shops them self are jammed packed with product and in many cases a complete mess with stock laying all over the place even in the big department stores. So for him buying OS/local online is his best solution to a problem many of the shop owners don't care about or think about and in my opinion why should they give a hoot it's there shop and they can run and stock it how they please plus my brother has the same attitude. With disability products here in this country they see you coming and the prices are just hiked up so even the disabled are looking for a fair deal on what they need to purchase. This then extends to every other purchase if they can make savings on disability products then there must be savings to be had with all goods so him being disabled also seeks out bang for buck deals all from his home in the comfort and surroundings that doesn't make life any harder than it is for him.
I could have sworn there has been people living here for quite some time And yes, they were all over the place.
But glad you could wade in and teach us all an economic lesson or two, thanks.
My answer to the Ops question, no.
I still shop locally for some things, if they are within a bull's roar on price. I got a Garmin 500 from my LBS yesterday because it was only about 10% dearer than online. When something is 50%+ or for products I cant get locally then yep, I will still shop online. My LBS know this and are fine with it, which is the reason they are my new LBS
The attitude of....This is what I stock and you need to settle for something from my limited range. And that wanting something outside my range is disloyal. That has to change.
"When people can't use essential services because there isnt enough GST revenue to pay for them, people will realise that levying the GST is fair, equitable and necessary"
Did Gina Rinehart take up cycling and discover wiggle? Quick, someone tell Wayne!
Where you don't understand this - is that enforcing the tax laws of the country is not protectionism - it is enforcing the laws of the country. Protectionism is about large tariffs or equivalent quotas to ensure that local business remains viable (and in many cases pay exorbitant wages to unskilled staff - but that is a story for another day) - I am not proposing GST be levied for local business to remain viable - the tax must be levied because it is on "consumption". Like it or not, the tax was an end user based tax - so the tax must be levied on the end user - if the end user is exempt by buying over the internet - the tax is then a tax on business (which is the very argument these businesses are using).
Where people buy from I honestly don't care - I have bought over the internet myself from Wiggle for apparel, because it offers a large variety and items my LBS won't stock (I understand these arguments) - but I do believe the Government should do the right thing by the system, and that means levying a customs assessment charge, and a GST and tariffs where appropriate (which have been reduced, but not removed totally). The Australian importers and wholesalers are doing nothing immoral or wrong in having a business here, they are just trying to create wealth and employment are subject to these charges - so I cannot see why the public is exempt - because to be quite honest, the public are the first people to have their hands "out" for free hospital and health care, essential services - so in a user pay capitalist system (and one so many are happy to take the "gains" from) - do the right thing and contribute your share, and pay your GST on "consumption".
Happy to pay my fair share as long as the corporates are too. Then again, I believe Operation Wickenby is a far more effective way in ensuring retrievable of tax revenues because it shows the ATO in this country aren't afraid to go after big fish (unlike other countries).
As for 'handouts', that is such a one-eyed view of some of your fellow citizens that I don't believe in continue to debate with you over this point (just let me know how many offshore trusts you have and the profit margins you think are entitled to).
Happy to pay my taxes because in this country I can see it goes to hospitals and schools and those who need welfare. I've lived in societies where people try and avoid paying their taxes and the government and its institutions are pretty dysfunctional there, and the gulf between rich and poor can only be described as a pre-French revolutionary state.
Amateur oenologist and green-friendly commuter.
They all want to be millionaires yesterday, nobody beleives in saving a few years nowa days.
They need to look at their profit margins as well as their importers etc, lobby the government to reduce import duties and other taxes so they can compete.
Why should the consumer keep propping up the rich picks.
I wouldn't mind some of these "free handouts" wherever they are.
Just let me check my payslip it should be written there somewhere.
The free handouts to which I refer are simply the Department of Social Security system (and all of the myriad of Family Tax Benefits - "middle class welfare"), Medicare system and state health hospital system (which is directly funded by GST and other revenues).
I have no offshore trusts.
The profit margin I am entitled to is none of your business, and is what the market will bear. This is not a socialist country and we do not dictate to people what they can or cannot make (and you, would well know, profit margin is nothing unless you actually sell enough to meet fixed costs and is an economic function of sales, quantity of sales, gross margin and costs). While others can dictate many of my costs, with wages (through Union awards) - I, as a businessperson am carrying all of the risk of failure, as well as the rewards of success.
I will say to you, as I say to many, if you think running a business is simple, mortgage your house, run the risk of financial failure and have a go - it is not as simple as everyone thinks it is as an outsider.
There's a good deal of us that don't get or use any of those. I sure don't get any family tax benefits, in fact it pisses me off every time the governemnt wants to give families more while singles like myself get SFA. I have top private health insurance so I don't use Medicare or public hospitals yet my tax dollars goes towards all of this. In fact I can''t think of a single thing that I've ever received directly from the government. I don't have kids so get no benefits from public schools or the myriad of other benefits given to those who elect to have kids. I've never been on the dole or even received Austudy. I've worked for everything I have all the way paying tax (hell, I even get to pay tax on the interest I earn on what I don't spend and manage to save) so others get a helping hand while at the same time being told more and more what I can't do by the government while they waste a good part of the tax collected so if I get to save a few hundred a year on GST and a couple grand more on the products themselves that I buy OS then yeah, I think I'm entitled to it.
The country would be better off actually collecting the income tax from companies such as ikea, google and the like who avoid it by intercompany services, than chasing me for 10% of what I buy off shore.
The trouble with jogging is that the ice falls out of your glass
LOL. You totally underestimate what the ATO actually spends the majority of its resources actually doing.
I fully support the arguments that Dobby has put forward, because they are undeniable. No one likes paying tax, but if you are going to charge it, then charge it on everyone for everything because anything else distorts the market and in this case, actually hurts Australians because there are less jobs and businesses to employ them. If its cost prohibitive to collect, then exempt local purchases. I think that's bloody stupid as a proposal but that's exactly what you are trying to advocate by defending the overseas purchases.
For the record, I wouldn't buy at Cell or Torpedo7 - they are just WAY too expensive compared to CRC or Wiggle. I will consider buying from Australia if they drop their price by 30-40%... I'm trying to negotiate a package deal at the moment. I can't afford to waste money to support Australian anything - I will work around the rules that are in place, because the law is the law, but I couldn't defend the dodging in good conscience.
Any time the Government gets involved with taxes, they stuff things up. The hope is that the taxes will pay for something useful.
Thanks for sharing your thoughts dobby. I appreciate the courage it takes to argue against the tide of popular opinion.
I have a question: If the Govt. claim is true and it's going to cost more to collect the GST on imported goods under $1000 than they actually collect, isn't your proposal to apply the law equally just going to cost the Aussie Tax payers money? Isn't chasing those sub-$100 GST payments going to leave us with fewer essential services?
Of course, the assumption is that the Govt. is correct when they say it will cost too much to collect them. Surely, in today's age of electronic banking for online purchases, they would be able to slip in 10% fees automatically ....
Think outside the double triangle.
Imagine a world with no hypothetical scenarios.
My proposal that GST be collected is fair, just and possible. It is financially viable.
Strange how the Government (and society supports them in this) can enforce laws on business to work as unpaid tax collectors for GST, PAYG and the like - but won't incur the expense themselves. Many businesses spent thousands, tens of thousands, and probably millions in the case of large multi national companies to implent GST collection systems - and it appears the Government wont do similar - that is really, really pathetic.
The Government argument that it will cost more to collect GST and Duty than they will recoup is not a valid argument. Levy a fee for collecting the Customs charges (importers like myself pay a $200 customs charge for duty assessment on containers, levy a $45 processing fee, the GST and Duty at an 8% uplift factor on the total cost of the consignment, that is the items and freight - which is what people who import have to pay if doing it commercially). It will not be "perfect" but these fees are why many Australian items are more expensive than their imported counterparts - because of extra charges importing businesses have to pay - make it fair and let everyone pay.
If this system is not addressed the GST must be changes in one of 2 ways - exempt retail purchases less than $1000 in value for goods that can be legally imported, keep the 10% GST on food, and increase the GST on other goods greater than $1000 in value to make up for the GST "lost" in exempting the items under $1000. That is fair, that is just, and a level playing field for everyone.
For the poster who receives "nothing" for his taxes paid, look again and open your eyes and stop being so narrowminded and selfish, you live in a country where you drive on roads (funded by the tax system), your country has a defence service (funded by tax system), in a natural disaster there are emergency response services (funded by the tax system), you probably don't have polio or measles or mumps outbreaks (immunisation funded by the tax system), you are able to go to a hospital and your doctor visits are funded by Medicare. Your type of attitude really shows how selfish people are - you "get" lots of things from the tax system, it just didnt suit your narrowminded argument to acknowledge those. It was your choice not to have children, but here is the thing, some of us want the country to continue, and people do have children - who else will pay tax to keep you in your old age, when you need aged care?
I thank those for commending me for having a differing opinion, this is why we actually have people study Economics at Uni. So that there are people who can look on a very broad set of circumstances (that many Econometrics people can't do). I will leave you with one of my favourite quotes "If mankind minus one were of one opinion, then mankind is no more justified in silencing the one than the one - if he had the power - would be justified in silencing mankind" JS Mill (On Liberty).
You are correct - I just wish they were more successful.
The ATO uses classic bully tactics - mostly everyday folk have no choice but to comply (or they feel the full force of the ATO and their righteousness) whereas money and power are treated a whole lot differently and settlements are often negotiated.
And don't get me started on tax exempt organisations such as religions - particularly Sanitarium
The trouble with jogging is that the ice falls out of your glass
I got nothing as a single either, and I get nothing as a family either. According to the ATO, my non-working wife is not a dependant, and neither is my 2 year old son. We get no benefits, did not get any "baby bonus", don't get any Family Tax Benefits. I still have to pay Medicare + Private Health to avoid getting slugged extra. To add insult to injury, the govt recently changed the Medicare Safety Net to specifically exclude certain obstetric items, so now I am up for thousands of dollars for our second child because we chose not to burden the public system (our nearest hospital is Private only). I actually did the sums, and purely from a tax perspective, we'd be better off as a family if my wife and I separated! That sounds insane, I know, but that is how it is.
I don't mind not getting benefits. What irks me is people who get all of the handouts and then still whinge that they pay too much tax!
'11 Lynskey Cooper CX, '00 Hillbrick Steel Racing (Total Rebuild '10), '09 Electra Townie Original 21D
What I said was "In fact I can''t think of a single thing that I've ever received directly from the government." See that word directly, as in hand outs, benefits, bonuses etc? Yeah there's roads which I get to pay more for through taxes and then in order to be allowed to use them I have to pay for a a license and then if I want my own car I also get to pay rego (not to mention the tax on purchasing the car itself) then to run it I get to pay excise on the fuel and GST on the excise. Sure we have a defense force and emergency services and a huge array of other governemnt services. Not sure about that immunisation thing. I don't recall ever having any immunisation but maybe I was too young. I've certainly had measels and mumps and plenty of other things though so maybe if I've been immunised I should get a refund? I can go to hospital or to see a doctor but as I said I have private health insurance so I don't use Medicare (not that I've used that either except for a bit back on dental and optical). Yeah you're right again that I chose not to have children but why do those that do choose to have children when they can't support them then expect a handout from the governemnt? Would I get a handout if I went out and did something I couldn't afford? As for old age, I doubt I'll get anything there either. The pension probably won't exist by the time I retire and even if it does, going off how it is today you basically have to have nothing in order to get the pension. Own a house = pension reduced. Have some money in the bank = pension reduced. Have some shares or other assets = pension reduced so I'm pretty sure I'll be paying my own way all the way to the grave (which I'm sure I'll be taxed on). AS I said though, at no point do I receive anything directly from the government. Am I being selfish? Yep I am because I'm the only one looking out for me so I have to be. With that established I'll try and bring it back on topic.
The fact remains that the government says they don't want to collect GST on private imports below $1000. Is it fair to retailers? Probably not but arguing for the introduction of it isn't exactly endearing retailers to consumer is it. All the consumer sees is the retailer trying to cut some of what the consumer is saving and in the end the private import is still going to be cheaper so it looks fairly petty action by the retailer. So while I can see and even agree on some level that the playing field should be level, I can also see that the real effect the whole argument is having is turning those that already import further against those retailer tryign to spoil their party and keeping the issue in the media just continues to bring it to the attention of those that don't import but then see hundreds of people say "yeah I buy on the net and save up to 70%" etc and then think to themselves "maybe I'm missing out and should be buying online as well."
I don't agree that it's economical to collect all GST however. eg one of my recent purchases were some LED globes off ebay for a whopping $4 shipped. Do you really think the administration costs of recovering $0.40 wouldn't be more than the collected $0.40? Now my latest purchase was $255 shipped so $25.50 GST may be worth it (BTW cheapest local price for same item was $408 and they didn't have stock anyway) but if the government says no, that's fine with me but either way, the sale was always going OS.
All I ask is that you read what I wrote earlier, this issue is not unique to Australia, it is happening globally.
If you send something to the UK, VAT is collected on items over 38GBP (about $55 to $60 Australian Dollars), similar to Canada and a little higher to NZ (but not a lot). The decision has been made there that it is worthwhile to levy VAT or GST - so as Australians we get no advantage from exports to those countries - but our buyers do gain from imports and tax exemptions - so business loses twice - it is a really really bad policy implication - similar to a reverse Marshall Larner principle. Australian business loses on exports to those countries due to their restrictions - and loses from imports here.
If someone imports commercially it is ok to levy them witha Customs fee, Duty and GSt at a figure 8% higher than purchase price (freight and insurance is added to the purchase price at the exchange rate at the date of purchase - which sucks if you hedge currencies or buy your currency forward in a strip hedge for a series of imports - but that is a story for another day) - same must apply to buyers importing privately, charge them a fee for Customs Clearance, and Duty and GST at the FOB cost.
The storage fee is called "demurrage" and every importer pays it if their paperwork isn't in order - so why should the consumer be exempted too?
I understand other governments do it but perhaps they're more efficent than our and aren't as bogged down in as much red tape or as many levels of government? Perhaps they're just more competent? Don't know as it doesn't interest me enought to look. Using your example though if they only charge for say over $50 that'd be $5 for us but isn't the UK VAT currentl 20% and therefore would be $10 for them? Right away they have twice the value to work with in order to make it cost effective.
As for private importers paying customs fees and duty, they do but again customs only bother if it falls over the $1000 value probably because they're even smaller amounts than GST and again not cost effective to collect(and BTW that $1000 limit does also take into account shipping costs, not just item value). Most duty rates are only 5% (there are exemptions, especially alcohol and tobacco products) but there's also a wide range of duty free products and also some of our trade agreements also allow for duty to be waived (eg most US made products purchased from the US). The customs fee, which these days is really a fee to register in the customs cargo system, is a hair under $50. Demmurage is also charged to private importers if they don't get their act together and complete the clearence quickly so the system is fairly similar in those regards, it's just the GST free amount that differs.
What do you think the limit should be if not $1000? I think we agree a blanket applying it to everything isn't practical. At a guess, I figure a customs admin officer must earn say $20/hr. Let's say it takes 15min to asses and issue a GST notice so in terms of labour $5. Say another $5 to cover stationary and credit card merchant fees to issue and collect payment so let's say it costs $10. That would make everything up to $100 impractical. I'm probably being conservate in these figures as well. Do you know the limit used to be $500 for courier deliveries? Wonder why they changed it? Maybe it wasn't cost effective even then? It wouldn't surprise me. At a guess and looking at my own purchases (several a month) I'd say 80% are probably under $500.
Anyway, I don't know what the actual happy medium figure is but obviously the government believe's it's currently $1000.
oxford, noted. Didn't realise that though I'd say by the time I retire it won't be the case.
As someone who deals with your tax system regularly, trust me, they are not bullies. They are trying to get people to pay what the democratically elected MPs have determined they should pay. Everyday folk need to pay their taxes, just as much as the Packers and Murdochs and Forrests, and yes, they don't have a choice but to comply. Australia is a tax system that doesn't have an "opt in" clause.
And (segue) that is precisely why the overseas GST under 1000 bucks is such a ridiculous exemption. The businesses that collect the GST aren't in a position to say "its too hard, just let it go". No matter how small or insignificant the purchase, they must charge GST and wear the full cost of administering that collection and remittance to the ATO. This gets passed onto consumers, and in the end we ALL pay for that collection.
That's OK - life's tough like that - but don't think for a second that exempting imports under a grand is saving anyone money. GST costs money for local businesses to administer, but when it comes to the Government collecting it, it's too hard? That's two sets of rules. It's worth remembering that GST costs a LOT of cash to look after. If you can't see the barriers that are in place for local businesses, then you need to think harder about the issue.
Australians do not win. The people who suffer the most from this tax dodge are the least well off, the poor people who can't afford computers and internet, aren't smart enough to use them, and can't spend enough money on Wiggle to make it worthwhile. The instant you create loopholes that only the wealthy will take advantage of, that's the moment that you have an unjust system.
If you don't like the laws, get your MP to change them. If they won't, run for office yourself. There are options, but crying on the internet that you deserve to avoid GST because you shouldn't have to pay tax on an imported good that your neighbour would have to pay tax on if he buys it down the street is incredibly shortsighted, and quite childish.
No doubt - my only beef with the GST crybabies is that there is some assumed right to avoid paying the tax, and present ridiculous arguments like cost effectiveness, forgetting that Coles has to charge you GST on a Mars bar worth $1.50. After working a checkout, I can assure you that if it's even remotely busy, a sale for $1.50 costs a business money.
I think it's quite insane that prices are so much more expensive here, and quite frankly I think Australia is digging itself an economic grave with the Workcover, public liability insurance, etc etc etc. Our prices are more expensive because global manufactured goods must pass through our Customs, taxation and industrial relations regime before a consumer gets to touch it. This is directly attributable to ALP policies over the past 30 years.
As a result... I don't agree with the protectionism afforded to our workers - no one has been reaching down to wipe "MY" backside in the workplace, so I don't support Australian companies if it doesn't suit my needs. I am happy to be labelled a scab or whatever name you want to throw around - Australia will be wiped out in any serious economic, military or cultural assault, and I really think we need to be knocked down a peg or two.
so yeah. I'll still buy overseas, duty or not. Australia cannot, will not, compete.
Or would could go back to the old days, where clearing agents have to process all incoming packages.
A $500 item will have 10% GST + $50 clearing fee (how much it costs to have an idiot type spend about 1 minute typing a few numbers into a computer and maintain access to such) + credit card processing fees for those fees (or take 2 more days while they 'clear' your EFT) and charge an extra $20 bucks for the slowest most expensive and unreliable courier service to deliver it from the clearing agent to your door. Those fees may make sense on a container of goodies but on your 100 gram Garmin GPS?
On the other hand with so many people simply charging 'what the market will bear', people won't 'bear' it and with all that it's probably going to be cheaper to mail order it anyway.
The only people "crying on the internet" have been the big boys in town, the top end retailers who are secretly bunking for an exclusion from GST for their goods under $1000.
Me, I'm happy for the rules to remain the same, but if the government did decide that Customs needed to chase GST on every little $10 imported product I guess I'd pay it..... and still be ahead for most of the sorts of overseas purchases I've been making. When products are a) not available in Australia, b) sold at a 60% - 100% price premium; a 10% GST makes little difference to my purchase decisions.
Riding bikes in traffic - what seems dangerous is usually safe; what seems safe is often more dangerous.
Exactly, the retailer is already collecting payment from the consumer, for imports, customs would be collecting solely for the sake of GST. There an adminsitration difference in adding a GST line to an invoice that already being generated to generating an invoice solely for GST. As said though, I wouldn't care if GST was levied across the board, it'd have no impact. I was buying OS before there was GST, I was also buying back when the AUD$ was down around the $0.60 mark compared to the US$
How long ago was that? I've been importing privately for 21 years now and have never been required to use a broker. It certainly wasn't easy in the early days as it was harder to find the required info but it could be done and was easy enough once you figured it all out.
In theory if we charge a GST on a low price good in Australia then we should do the same for a low priced imported good. The problem is that collecting the tax is likely to cost more than it raises. Imagine the hue and cry if a Labor government altered the tax laws and made a loss? The conservative press would go ballistic.
One of the biggest weaknesses of this campaign to levy a GST on low value goods is the proponents. These are large companies who are notorious for avoiding as much tax as possible. Additionally, as I stated earlier, a lot of this is just a smokescreen so they can set up internet shops in China and avoid the flac. Where were Hardly Normal et al when Australian manufacturing was being put out of business by cheap imports? I'll tell you where they were, they were on the phone to China to be the first to bring in the cheap imports and at the same time lambasting Australian manufacturing for not being competitive. Bunch of hypocrites, the shoe is firmly on the other foot now.
As for those who say they get nothing from taxation, have private health insurance and the like, you do realise that the private health providers still get the medicare rebate and the your health insurance company just pays some or all of the extra your provider charges? I choose not to have private health insurance (and cop the extra levy) because I believe a public health system is fairer and more efficient, and I present the US health system as evidence of this. I too don't get family tax benefit, never got a baby bonus etc. I do have a kid but we earn too much to get these benefits (as probably most people here do). However, I do not have a problem with helping those less fortunate than I. I also have no problem with paying taxes.
To those who harp on about labour costs in Australia, just how little do you expect your employees to live on? Could you survive if you were working a 40 hour week and earning say $10 an hour? I doubt it.
As many here have pointed out, a 10% GST is not going to stop people buying overseas on the 'net because the price difference is substantially more than 10%. Oxford's example of software which is downloaded anyway is possibly the best example, just why is that more expensive here?
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