Thursday November 9, 2006

GST on DDU / DDP Shipments

Dear Members,

You may recall that we issued a bulletin on July 27th, 2006 in relation to the tax office ruling GSTR2005/6 and its effect on DDU / DDP transactions. (Please click here to view http://www.afif.asn.au/pdf/news/Jul06_GST0506.htm)

As advised in that bulletin, the industry bodies AFIF, CBFCA and CAPEC commissioned PricewaterhouseCoopers (PWC) to prepare a submission to the assistant Treasurer, in which we addressed the key implications of the ruling with a view to seeking legislative and administrative solutions for our members.

We have offered the CEO's of our member companies the opportunity to view the submission on the proviso that it is NOT to be circulated outside of your organisation. If you have not yet requested the document, please contact Juana at the AFIF Secretariat on afif@afif.asn.au to request a copy.

Following many detailed meetings, the submission was prepared and lodged with Treasury in September. The submission also included proposals in relation to how export transport related charges were dealt with.

On October 4th, we were invited to meet with Treasury and the ATO in Canberra to work through the detail of the submission. Following the meeting, Treasury advised that they would consider the proposals and respond to industry in regard to any law changes that would be considered for recommedndation to Governme n t. We received a good hearing and we further believe that the ATO and Treasury have a much greater understanding of the international transport industry and how this ruling could have serious impact on the industry.

Whilst we are bound by signed confidentiality documents as to the discussions that took place in that meeting of October 4th, we will send you more detailed information as and when we hear back from Treasury and / or the ATO but we have been asked to be patient as this could take some time and outcomes and subsequent decisions are unlikely this year!   

In the meantime we would be grateful for advice on any audit activity you may have been subject to , in relation to the ATO GST Ruling GSTR 2005/6.

Thank you and kind regards

Brian Lovell

Chief Executive Officer
Australian Federation of International Forwarders Ltd (AFIF)

Suite 403, Level 3
152 Bunnerong Road
Eastgardens
NSW 2036
Tel: (61 2) 9314 3055
Fax: (61 2) 9314 3116