Suppliers of the following types of services or goods to Australian consumers will, therefore, need to review whether they need to be registered:
- Digital products such as streaming or downloading of movies, apps, games, e-books, etc.;
- Services, such as legal services;
- All goods; previously, a low-value threshold applied whereby goods of a value less than $A1,000 were exempt from GST; this exemption will no longer apply.
Overall, the above changes seek to widen the Australian GST net by requiring certain non-residents who supply to exempt consumers to register, collect and remit GST on the supply. In effect, the Government is seeking to level the playing field by placing non-resident suppliers on a similar footing to local businesses supplying Australian consumers.
Other changes, effective from 1 October 2016, on the other hand, seek to remove the requirement for non-resident businesses to register for GST where they only supply to Australian businesses that are registered for GST. Business-to-business transactions generally have no net revenue outcome, so removing the registration requirement in these cases is a positive step. Each case does, however, need to be reviewed to determine the requirement to register or not.
Online applications for registration by non-resident businesses affected by the new rules effective 1 July 2017 can be completed with the Australian Taxation Office.