Changes to GST Won’t Stop Australians Shopping Overseas
TWEET: #MasterCard: Proposed changes to GST unlikely to quell #Aussies’ appetite for overseas #online shopping. http://bit.ly/XuZPbG
Sydney, 23 January 2013 – With the issue of GST exemption levels a hot topic for Australian retailers, a new MasterCard study shows increasing tax on online purchases is unlikely to have much of an effect on shopping habits.
The research reveals that while 79 per cent of Australians oppose reductions to exemption levels, it won’t quell their appetite to spend. Specifically, among frequent online shoppers surveyed, 38 per cent said a change would have no impact on their behaviour, while a further 24 per cent say the move would only cause them to buy online less often.
MasterCard Australia’s vice president strategy and corporate affairs, David Masters said the study shows price isn’t the only motivating factor driving people to shop with overseas online retailers.
“Australians are right at the forefront of the modern retail experience where online shopping has become the norm. For many, the comparative benefits are too good to pass up.”
“86 per cent of the people we surveyed said price was important, but there’s no question that Australians are hard wired to want to shop locally.”
“The challenge for Australian retailers is to deliver where overseas retailers cannot – service, delivering a personal approach – and there are so many local retailers who get that absolutely right.”
While the Commonwealth Government has indicated they do not intend to lower the tax-free threshold in the short term, the MasterCard study illustrates any changes won’t slow the desire of Australians to search the world for a bargain.
Chief executive of local online retailer Dealsdirect.com.au, Michael McRitchie says reducing GST exemption levels won’t stem the tide.
“The current online market dynamic is here to stay; the onus is on local bricks and mortar and online operators to lift their game in areas where the can make a difference. After sales service, delivery times, product knowledge and being a ‘trusted Australian name’ count for everything in the online world.”
Other key statistics from the MasterCard research into online shopping include:
- 12.6 million Australian adults have shopped online in the last twelve months
- Two out of every three shop online at least once a month
- 60 per cent of regular online books/DVD shoppers claim GST changes won’t deter them from shopping overseas online
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Notes to editor:
- This study was conducted online by Galaxy Research between Monday 19 November and Friday 23 November 2012
- The study was conducted among a representative sample of 1,250 Australians aged 18-64 years who shopped online in the last 12 months
Sophie Moll, 02 8281 3868, firstname.lastname@example.org
Chris Lawrence, 02 8281 3295, Chris.Lawrence@originagency.com.au
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