By ARON LEWIN
New tax: GST hits online goods
In a meeting on tax reform on Friday, state treasurers unanimously agreed to apply a goods and services tax to all products purchased online.
GST is currently incurred for products bought online that cost more than $1000. But the new policy – which will be implemented on July 1, 2017 – would abolish the tax-free threshold.
In The Conversation Michelle Grattan wrote that “overseas suppliers will collect and then remit the tax for both digital products and goods”.
While the cost of goods purchased online will increase, it will boost the state governments' coffers considerably.
Treasurer Joe Hockey said it wasn’t a broken promise, just an integrity measure to “plug the holes”, despite stating there would be no changes to the GST until after the upcoming election.
The New Daily reported that the National Retail Association (NRA) quickly lauded the move, because it would make the bricks and mortar retailers more competitive.
“The NRA has been arguing for many years for an end to this unfair loophole,” NRA chief executive Trevor Evans said.
“[It] disadvantages local businesses, costs Aussie jobs and takes away tax revenue that could be spent on local services and infrastructure.”
“Because the GST exemption also triggers an exemption from import duties and customs charges, the cost difference can be as high as 25 per cent compared with a product sold here in Australia.”
Hockey said the 10 per cent "tampon tax" would not be removed, because a unanimous decision was not made to abolish the tax on feminine hygiene products.
But nicotine patches and condoms will remain untaxed as they are classified as "health goods", rather than luxury items.
Unmarried, unemployed, and living with parents: unflattering report on Gen Y
In the The Guardian, Shalailah Medhora wrote that an Australian Institute of Health and Welfare (AIHW) report found “young Australians … [are] more likely to be unemployed, unmarried and living at home with their parents” than previous generations.
Youth unemployment rose by 4.5 per cent to 13.3 per cent between 2008 and 2014, the report found.
In response, the Federal Government proposed a four-week delay on jobseekers under 25 receiving Centrelink payments. But that proposal hasn’t passed the Senate yet.
The Guardian reported that the Government spends $93.1 billion on the age pension, disability and carer payments, while just $7.5 billion is spent on unemployment benefits.
In the Courier Mail, Beyond Blue chairman and former Victorian premier Jeff Kennett outlined solutions to “reduce the unacceptably high rate of youth unemployment”.
Kennett said the Government should task youths who received welfare payments with labouring projects to “ensure … there is personal accountability and responsibility”.
He also proposed students in their final year of school should engage in a mandatory year of community service.
“What better way to address some of today’s vexed social issues than every young Australian giving up a year in the service of their country, working alongside Caucasian, indigenous, Asian, Muslim, African, European and every other configuration of human being,” he said.
“Community service could take any form or, for those who elect, military service.”
Woolworths’ senior management cull continues
Big W’s managing director Alistair McGeorge resigned on Thursday, citing ill health. It came amid complaints from staff members about McGeorge “verbal” behaviour.
The department store’s earnings have dropped from $200m in 2010 to $130m in 2015.
McGeorge began the job early last year, and promised this year Big W was “going to be the No.1 choice for Australian families in general merchandise”.
On Thursday, it was reported supermarket giant Coles increased its earnings by 6.6 per cent over the past year to $1.783 billion.
In the Business Spectator, Victoria Thieberger wrote that Coles’ sales growth had eclipsed Woolworths' every quarter in the past two years, because Woolworths “continues to be seen as the more aggressive brand”.
After its market cap fell from $48 billion early last year to $34 billion in June this year, Simon Evans reported in the AFR that “major change is coming at Woolworths, and it will either be from within or imposed by a new owner".
Columnist Tony Boyd wrote in the same publication that Woolworths chairman Ralph Waters and chief executive Grant O’Brien were “lame ducks”, who were creating dysfunction and uncertainty at the board level.
Woolworths’ director of group retail services Penny Winn has taken over as Big W’s managing director, and Woolworths is set to release its annual results next Friday.
Qantas records profit, rewards itself with a shopping spree
Qantas has remarkably turned its losses around, reporting a pre-tax profit of $975 million after suffering a $646 million loss last year.
According to the Business Insider, the airline’s revenue is up 3 per cent from last year and shareholders are expected to receive dividends for the first time since 2009.
Sydney Morning Herald business reporter Matt O’Sullivan wrote that this was due to “deep cost cutting over the past year, a sharp fall in fuel prices, lower depreciation charges, a truce in the so-called capacity war with Virgin and an easing of competition on international routes”.
Since 2014, Qantas has made 4000 jobs redundant.
Qantas CEO Alan Joyce also said Qantas was rapidly growing fitter, stronger and faster.
“Our first priority has been to put Qantas on a strong footing for sustainable future growth. We are now well into that journey, and with the group returning to its strongest balance sheet since before the Global Financial Crisis, it is fitting to recommence shareholder distributions,” he said.
Qantas staff are expected to receive bonuses, and the company has announced it will purchase eight new Boeing 787-9 Dreamliner planes, which will begin being delivered in 2017.
According to the AFR, the list price is $US264.6 million.