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On July 1st, 2018 new legislation was introduced to charge a 10% GST on the price of products under a value of AUD $1000, such as books,jewellery, electronic devices, sports equipment, cosmetics or clothing imported into Australia.Most goods are valued by Customs & Border Protection at the transaction value in Australian Dollars. Customs use the rate of exchangeprevailing on the day of export of the goods (not on the day the goods arrive in Australia) as the exchange rate.The amount payable is determined by the classification of the goods and other factors including exemptions, concessions & existence of preference schemes (e.g. a Free Trade Agreement between the origin country & Australia). When importing goods, the submission of the declaration to the ICS will automatically calculate any duty, GST, Wine Equalisation Tax or Luxury Car tax payments that are required. A
payment advice is then issued to the owner. Once settled, Customs will clear the goods. On most products imported into Australia, customs dutyis 5% of the value of the goods converted to Australian dollars, but this is dependent on the type of goods. The importing company will need to check with their freight forwarder or Home Affairs for the correct amount of customs duty.Aside from a few exemptions for some basic foodstuffs, certain medical aids and appliances, precious metals and other items, most goods will be subject to GST when imported. GST is applied at 10% of the Australian dollar value of the goods when imported. The value of theimported goods is equal to the goods value (as detailed above), plus the duty payable, and any transport & insurance fees for the goods.GST on a taxable importation is payable by all businesses, organisations and private individuals. Whether they are registered for GST or not. A business or organisation registered for GST, importing goods as part of its activities, may be able to claim aGST credit for any GST paid on those goods.The importer who registered for GST, they may be able to defer the payment by participating in the Deferred GST Scheme. This scheme allows GST on taxable importations to be deferred until the first business activity statement lodged after the goods are imported. Participation in the scheme requires certain eligibilitycriteria to be met:- have an ABN- must be registered for GST- lodge activity statements, online, monthly.- pay activity statement payments electronically.Additionally, a business may be ineligible if- its tax returns & payments are not up to date- an applicant has been convicted or penalised for certain offencesHere is a quick calculation to work out the customs duty on the value of goods. The most household items should come under this customs duty calculation.1. Convert your purchase into Australian dollars.