CBFCA calls for caution on proposed GST changes

A review of how the tax applied to delivery duty paid (DDP) and delivery duty unpaid (DDU) shipments and exports was part of this month's Budget announcement.

Treasury released a discussion paper containing proposals to "amend the GST Law to reduce GST compliance costs for businesses involved in the domestic transport of exported and imported goods with effect from 1 July 2010".

"By no means does (the discussion paper) constitute a final determination of the issue and it may suggest that the current levels of exposure remain in place," the council said.

The discussion paper made the following points:

• There will be a broader review of GST payable in cross-border transactions;

• This is only a discussion paper for consideration by relevant parties and government;

• The proposal to change the law implies that the law as it currently stands does create problems for those providing transport services to non-resident entities who are sending goods by DDP and DDU means;

• The discussion paper does not address the retrospective application (if any) of the change in the law.

The CBFCA would continue to take a lead on the issue and make a submission in conjunction with its industry partners and external consultants, it said.

That intention had already started with Treasury and the Australian Taxation Office.