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  • Information for consumers

    If you are an Australian consumer and you buy imported services and digital products electronically, you may be charged goods and services tax (GST).

    GST will apply at the point of sale in the same way it does when you buy similar services or digital products from a business in Australia. You may notice the amount on your receipt for these purchases will include GST.

    However, as with sales from merchants within Australia, some overseas suppliers may not be required to register for GST (because they do not reach the A$75,000 threshold) and will not charge you GST.

    GST does not apply on sales to GST-registered businesses, of imported services or digital products purchased for business use.

     

    Example – GST applied to sale of digital service

    Jo is an Australian resident and has a digital movie subscription from an overseas company, DigiTV. Jo receives a monthly invoice and notices that the invoice for July includes GST. As DigiTV is an overseas company that was required to register for Australian GST from 1 July 2017, GST is correctly included on the invoice. DigiTV will remit that GST to the Australian Tax Office.

    End of example

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    Listed prices and GST

    When you make a purchase online, the merchant may initially be unsure if GST will apply. In this circumstance, the online merchant will advise that additional taxes may apply. As soon as the on-line merchant knows GST applies, they should confirm the GST-inclusive price.

    Generally, if GST is likely to apply to an item, the on-line merchant should display a GST-inclusive price. This is a requirement of Australian consumer law, which is administered by the Australian Consumer and Competition CommissionExternal Link.

     

    Example – Price of digital product

    Yarran buys a digital songbook from an on-line merchant in China. The online merchant ‘World Music Online’ sells digital sheet music to consumers worldwide and is registered for Australian GST. Yarran selects the sheet music he wants to buy. The listed price is A$20, however a note states that ‘additional taxes may apply’. When Yarran enters his Australian credit card, the price changes to A$22. The price now includes GST because Yarran’s Australian credit card information has allowed ‘World Online Music’ to confirm that Yarran is an Australian consumer.

    End of example

    Cancellations and refunds

    The GST rules that apply to returned items and refunds in our domestic market also apply to imported services and digital products. This means if you cancel a digital product and get a refund or seek a refund relating to an imported service, you should also get a refund of the GST.

    Last modified: 27 Sep 2017QC 53381