The Australian government has announced an increase to the Import Processing Charge (IPC). Retailers are still arguing that the government should scrap or lower the $1000 duty and GST free threshold, which sees lots of Australians buy retail from overseas, but also allows importers to order multiple samples without incurring government charges.
Import Cost Impacts
Quite rightly importers are upset with the prices increase, with industry commentators speculating that the additional funds are not then re-invested into port infrastructure, but swallowed into government coffers.
A real issue the government seems to be ignoring is some suppliers in China are developing direct channels with customers in Australia – with no value add, no local funds being re-invested in Australia. In particular TaoBao, Alibaba’s retail arm is making inroads into Ebay’s market share.
My Import Label supports small businesses to save costs by importing direct from suppliers overseas, but in no way advocates practices that are harmful to local industry and jobs.
Import Processing Cost Changes
- Consignments under $1000 will still avoid duty and GST charges
- Consignments under $10,000 will stay the same – $50 for imports by sea and $40.20 for imports by air
- Import declarations for seas increase from $102.60 to $152.60 for each consignment.
- Import declarations for air increase from $81.90 to $122.10 for each consignment.
The IPC charges will become effective from January 2014.
New IPC Costs – Impact on Australian Importers
- Continue to bring in low volume orders, and keep them under $1000
- Crunch the numbers on air and sea freight options when evaluating new products
- Plan for it. Cost increases are inevitable, just like the Aussie dollar that will continue to fall in value below the USD.
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