Australian Customs Duty

[essbee2085]

This query refers only to goods with a purchase cost of less than A$1,000.

I have noticed that since GST became payable on goods imported into Australia with a value of less than A$1,000, items out of the USA also include a 5% customs duty charge.

I have made three ebay purchases ex USA since 31 July - two watches and a set of headphones. On each of these items, GST has been charged at 10% (correctly), as well as what seems to be customs duty at 5%, all wrapped up in a single amount described as 'Import Charges'.

My understanding is that items costing less than the equivalent of A$1,000 do not attract Customs Duty.

Items I have purchased from other countries (correctly) include GST at 10%, but no customs duty component.

I've tried talking to ebay, who say that the 'Import Charge' is calculated by Pitney Bowes, and that they (ebay) have no control over what is charged (!!).

Has anyone alse experienced this?

Have I correctly interpreted the ATO's advice on its website that duty is not applicable (in general) to items costing less that A$1,000?

[countessalmirena · Accepted solution]

There are many threads in this board concerning this very issue.

I'm not surprised that you are puzzled by this charge. To the best of the ability of several posters here, it seems that PB are charging a fee for collecting the GST, and are then also applying GST upon this extra component.

Charging any sort of fee for collecting the GST is of course forbidden within Australia; Australian businesses must simply absorb that cost. But an overseas business like PB can apparently do so, because Australian law cannot enforce its not being charged.

I will just add that I've not seen anyone other than PB do this.

If at all possible, I shall continue to avoid purchasing from US sellers using the GSP - for a number of reasons.

[padi*0409]

If you but from the US or the UK and the seller uses the GSP (Pitney Bowes), they charge the 10% plus their GST collection fee - not eBay as would normally be the case. 

Edit. I'm slow as usual countess, must reach for a coffee....................

[essbee2085]

Many thanks for the VERY fast response!

Ebay has advised that they will check with PB and revert, but I'm not being overly optimistic on that advice.

It would therefore seem that PB is charging a fee to collect the GST.

I will re-contact ebay in due course and see what their response to that is. If they need to collect a fee to collect a fee, then they would be better of bundling it with the delivery/postage charge, rather than making it appear to be a charge the ATO makes.

[padi*0409]

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@essbee2085 wrote:

Ebay has advised that they will check with PB and revert, but I'm not being overly optimistic on that advice.

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Unfortunately the eBay CS reps will say anything to get you off the line (even if they know what you are talking about).

Trust me, nothing will happen.

[essbee2085]

Having had a number of conversations recently with ebay 'help' desk staff, I can only agree. Very quick at telling me how much they understand my issue, but always without a result. Extremely frustrating. Paypal just as bad.

[k1ooo-slr-sales]

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@essbee2085 wrote:

It would therefore seem that PB is charging a fee to collect the GST.

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the import charge is made of of several charges all combined into one, none of which is a “customs duty”.

These charges include:

- a PB fee for collecting GST

- a fee for processing the item for export (customs declarations etc)

- the GST payable on the fees charged

[timewallshop]

I should have been more aware/diligent when placing an order from USA.....   USD7.30purchase item and was slugged USD6.42 "import charges" ......  I have no idea how that is calculated.... but even adding the expensive shipping component the charge works out at around 25% of the total..... that will kill EBAY for me!  I effectively have just paid AUD50 for a AUD10 magazine

[padi*0409]

It sounds like the seller was using the Global Shipping Program (Pitney Bowes) to deliver your goods, read the whole of this thread to understand the extra charges.

[davewil1964]

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@timewallshop wrote:

I should have been more aware/diligent when placing an order from USA.....   USD7.30purchase item and was slugged USD6.42 "import charges" ......  I have no idea how that is calculated.... but even adding the expensive shipping component the charge works out at around 25% of the total..... that will kill EBAY for me!  I effectively have just paid AUD50 for a AUD10 magazine

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Instead of AUD40 for an AUD10 magazine?

Doesn't seem that your initial scenario was particularly cost-effective. Unless, of course, you had to have it, in which case the value is irrelevant. I bought a couple of books many years ago for about twice what they would have cost if I'd waited a few years for them to come on the 2nd hand market. I was prepared to pay the price, because I wanted them. And they're now worth more than I paid.