Phil's romantic notions on windsurfing and the GST

Phil, can you think of an easy solution to resolve this? Unfortunately, I don't think the government is going to change their fees they imply.

I think taxing things that enter the country the same way, regardless of value, is a better way to go, but it would be very hard to police, and people would write down the value of things. Although some revenue (if something is marked down in value) is better than nothing.

Maybe in this electronic age, each item to enter the country could be assigned an id, and you had to prepay the tax before it arrived? Who knows what would work. Something with minimal work required by customs, but still returns value.

I do think it is unfair that you have to compete with outside companies that do not end up paying duty or gst. I also think its unfair that the postal system of the destination country ends up effectively subsidizing the postage costs too.

From a micro level, you might be better off operating an external company, as you mentioned, to deliver imported products from outside Aus. You can become their agent, and sell this way. You could also sell locally held product, the same way you do now, for those people that can't wait.

It seems our high AUD is making this situation worse. If the goods were not that cheap, a lot of people wouldn't bother importing them.


P.S. Why do all of your examples have the local company taking a 33% markup? Why would the local company take more of a profit than the off shore company? I know it doesn't really change your point though.

Nup, right now I am thinking maybe less is more, everything is going to get more global and that trend will accelerate, so trying to think of a tax for every little scenario is probably futile. I think the whole thing is way, way, too complicated, if you have a million rules then they are just going to start contradicting each other.
I kind of think it would be nice if there was no extra taxes like, stamp duty, payroll tax, GST and all the rest, then you just have income tax, have a sliding scale like we do now. You would have to make it more 'intent' based, i.e. if you hide income in an offshore account we have the right to make you show us that. Then we could enjoy the benefits of all this global competition a lot more and imagine if it really was a 3 page document, at least everybody would understand it. I do want to stress before I get flamed on this theory though, it's just a thought bubble.



I think at least they could have seen this coming from about 5 years out and worked towards a level playing field before it started affecting thousands of people. But yes, not a fan of being discriminated against by the tax office, you should try it sometime! It's also unfair that you have to pay all these costs 'cos I just mark stuff up and pass it on.



Just being an agent/warranty guy is pretty depressing, rather retire to the farm being the pirate that I am. External company, drop shipping etc, already happening in a big way, especially in cycling, but if you think about it, if you buy a whole lot of stuff in bulk (the locally held product) you get HUGE freight cost benefits, just that there's so much compliance/taxes that this benefit ends up getting wasted. A company just selling a few things at a time from overseas should not even be close to competitive, doesn't make sense unless it was really high value low bulk items like jewellery.


33% I just made it up. Margins differ greatly, but theres a common sense rule of thumb, if you are selling market leading stuff like coca cola they ain't gonna give you much, but if you are selling the local drop they tend to give you their first born. Good looking promo girls changes all the rules.
Do you mean more of a profit on $ terms for the same item as the % is the same? You gotta work out your cost for that item, then mark it up that's all the o/s guy has done, otherwise you'll have these massive 'overhead' costs and lose yourself.


I'm venturing into unknown territory here so could be wrong, but say a brand like select fins gets a whole lot of fins made in china and sent to their UK warehouse/distribution centre. Select will pay the UK duty when the goods come from China.
If you were a UK shop, you could buy that off Select send it on to your Aussie customer no duty on the Aussie side.
But if you were and Aussie shop, you would pay the duty on it coming into Australia from the UK, it's a double dip.
And if you were an Aussie business that got the fins direct from China you would pay duty as it comes in, but if you then sold it to a UK customer, that UK guy would pay the duty again (as they collect the duty at the border down to 15 quid).
If you the customer are able to buy the fin direct from China, happy days you've circumvented everything. But a UK citizen doing the same thing would pay duty.


I've heard about this something like they are obliged to deliver it cheaply as a part of a reciprocal agreement, I know nothing about it, but wouldn't you just change the agreement when it expired?


Unless you look at an example with the same wholesale cost and mark up, then it's impossible to examine the charges/gov't taxes, just like a science experiment, take out the variables examine one thing at a time.
Local distributors, buying groups and a million variations is the norm, but does not change the basic set up, just the local distributor would have paid all of those charges not the retailer.
Stitching up the market is basically the fundamentals of business, someone else wants to sell drugs on your turf, kill them, or wants to import stuff that competes with your business, lobby the Gov't to stop them, I agree this is not good. It occurs locally just as much as internationally. The Gov't should be striving to at least create a level playing field as best they can.

My aim was always to show that what the retailers are saying about 'red tape and gov't charges' is a decent part of the problem, and it was looking like the mob was hankering for a lynching of which I am one of the lynchees, and I'm already being rogered by the tax dept. "Better to die on your feet than live on your knees".

This IT enquiry with the Pollies brow beating about how they are going to be tough and subpoena salesmen to appear in front of them. Makes me sick, they know it's just a show, or worse they really are that stupid. May as well feed some Christians to the Lions while they are at it.

Here's an e-mail I got from the CEO of the NRA, looks like Swanny and co are going to be watching Boganomics on monday. There you go, Phil's kitchen table and seabreeze take on the world.

No. That's not what they are asking for. People like Harvey Norman are asking for protectionism. They operate with a 1960s business model. Let's face it.

In Chatswood a Harvey Norman went out of business. The shop regularly would try and flog everything at RRP or even worse at times add 20% to the RRP.

A month on from them closing down a JB Hifi opened in their place in the exact same retail space. The shop is doing a roaring trade. Why? Because their price are a little more in line with reality. Yes, some of their accessories are hopelessly overprices as well but their big ticket electronics are all reasonable priced.

Logic has it that they would have less competition from overseas shop on big items such as Flatscreen TVs and hence they should be able to keep the prices high. Yet they still regularly undercut Harvey Norman by 30 to 40%.

A quick questions: Do you actually own a store? If so what would that be?

I give you an example. I recently bought three flash units from a shop on Gorge Street in Sydney. This is one of the most expensive real estate locations in Australia. I am guessing their employees don't work for free either. Yet when I asked them for their best price they quoted me the exact same price both Adorama and BH Photo & Video in Manhattan charge. And this is taking GST into consideration. Yet, BH Photo & Video buys in such large volume that they would receive massive wholesale discounts.

So either these guys sold me the three products at a loss or the other shop around corner that quoted me a price 35% higher are a bunch of rip off merchants.

So please don't give me this rubbish of the poor Australian retailers are hard done by. If the business landscape is so bad just shut shop and do something else. EG move to WA, work in the mines, make a killing and go sailing on your week off. Done...

I think Australia is facing bigger problems at the moment then wasting time on worrying about collecting GST on products below $1000.

Could not help myself responding to this:-www.theaustralian.com.au/nocookies?a=A.flavipes

How did we ever end up with people like this making decisions on trade?

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Retail is kinda booming, but the growth bit right now is online with lower prices and larger ranges. But without any type of level playing field you are just excluded from taking part. Look at that tie example 27% extra cost for the consumer, unless you move offshore (no NDIS) you can't restructure, modernize and get busy.

Major costs for retailers, well it's all completely different, a lot of older guys own their own premises, some guys operate out of the back of a van, DJ's have a huge property portfolio, the only common thread is they are all disadvantaged compared to any overseas shop.

Then it just gets comical, when people start saying things like, 'compete on service', 'go online', good point! Tie shops could learn a thing or two from SUP shops, have tie tying lessons, form a tie club, sponsor tie races. But when a trade minister with an economics degree starts spinning populist crap starts getting a little less funny.

Nah, still funny, lets go to Mardi Gras Craig!