Customs investigating cars brought in by PRIVATE IMPORTERS.

[Guest]

They have found another thing to pick on private importers of SEVS and 15 year vehicles, it is a priority which is why I posted it where I could.

Firstly this came from an Importer who was questioned by Customs and he contacted his Customs Agent to verify the situation who stated it is correct theoretically if it was pushed. I spoke to one dealer who knows of one person who is being looked into for not declaring the exact cost of the purchase and it is a living hell.

According to the customs act to work out Duty and GST you have to declare the cost of purchasing the motor vehicle which includes the FOB cost.

Well they have been highlighted to the fact that people pay a BROKER a fee prior to the purchase of a vehicle in Japan here in Australia and is a cost to purchase that vehicle.

Cut a long story short you are suppose to or should of payed Duty and GST on the $770 to $1,200 you paid the Broker to help purchase that car from Japan.

A couple of people are under investigation for how they operate their bussiness including looking at the supplyiers of these vehicles (do they have prefered supplyiers as a Broker is supose to be looking after you).

The MTA and Fair Trading are also involved as it is being put across that a Broker in other industrys (Finance and Insurance) take a comission from the seller NOT the buyier so why should people pay them a set amount of money.

It is up to $10,000 fine per offence and they can seize the vehicle as well if they want to.

Below is the contact details of Customs so you can look into it if you have a car coming in soon, contact your Broker and Customs Agent as well.

This isnt a story or any thing like that, it is the greedy people trying to make it harder for us.

You can contact the Customs Information Centre on 1300 363 263 from anywhere in Australia or +61 2 6275 6666 from outside Australia or email [email protected]..

As Customs duty varies according to vehicle design and value, and is subject to change, you should contact a Customs office before importing any vehicle into Australia.

http://www.customs.gov.au/webdata/resource...es/Mvguide3.pdf

You may, if you wish, seek advice from a Customs Broker about the importation and Customs clearance of your vehicle. While this is not a requirement, many importers do so because of the information requirements of Customs and the possibility of penalties being imposed for the supplying of incorrect or misleading information. You will find a listing in the yellow pages of the local telephone directory under Customs Brokers/Agents.

Penalties for such offences can be severe and can, in some cases, include forfeiture of the goods concerned. Such forfeiture would be in addition to other penalties.

http://www.customs.gov.au/webdata/resource...ortControl1.pdf

[lwells]

That sounds totally retarded. The broker fee is payed for someone to source/locate and organise the purchase and importation of the car; it is not a condition or prerequisite of the purchase proper nor a necessary cost.

I would imagine any half-decent lawyer would have a field day with this.

LW.

[Guest]

That sounds totally retarded.  The broker fee is payed for someone to source/locate and organise the purchase and importation of the car; it is not a condition or prerequisite of the purchase proper nor a necessary cost.

It is a cost of the purchase which is how Customs looked at it, we know what people think it is about but who wants to get caught out or have customs investigate them,

[go_nuts]

With the broker's fee, usually GST is already paid so what's the fuss anyway?

[lwells]

It is a cost of the purchase which is how Customs looked at it, we know what people think it is about but who wants to get caught out or have customs investigate them,

No, my point is that it is not a cost in the actual purchase of the vehicle; its a fee for an associated but seperate service.

LW.

[Shell]

i agree with above comments...totally retarded...and as go_nuts said, brokers fees already have the GST applied to them!!

[Abo Bob]

As long as you are doing everything else right I wouldn't worry. You can write letters after they try to do you for it and if that fails take them to the Administrative Appeals Tribunal unrepresented and since you will probably be the first one to challenge it you will get your lawyers paid for by the government. They pay for you because they are using you to test the legislation and their interpretation of it.

[The Jake]

No, my point is that it is not a cost in the actual purchase of the vehicle; its a fee for an associated but seperate service.

LW.

Yes but I think it is you who is missing the point. By law ALL businesses are required to charge GST on all goods AND services they sell. The GST is to ensure the government gets its slice of the pie. I'm pretty sure there are some exceptions but I don't know what they are.

So in other words, to anyone who is conducting business properly, this is a non-issue.

- J.

[lwells]

Yes but I think it is you who is missing the point. By law ALL businesses are required to charge GST on all goods AND services they sell. The GST is to ensure the government gets its slice of the pie. I'm pretty sure there are some exceptions but I don't know what they are.

So in other words, to anyone who is conducting business properly, this is a non-issue.

- J.

If you read what is posted, it is Customs not the ATO that is making the fuss; they are claiming that you should pay GST and duty on the customs agent fee because its supposedly part of the purchase price. In other words, it would affect everyone using an agent.

Well they have been highlighted to the fact that people pay a BROKER a fee prior to the purchase of a vehicle in Japan here in Australia and is a cost to purchase that vehicle.

Cut a long story short you are suppose to or should of payed Duty and GST on the $770 to $1,200 you paid the Broker to help purchase that car from Japan.

LW.

[regan]

This is NOT about GST, its about a customs ruling that : all costs associated with importation/ purchase of a vehicle be it de-reg, inland transport ,entry in Jay ect be included in the FOB invoice and be fully dutiable.

I guess they are including in this the costs paid to a Broker.........

ie: car cost $ 5000.00

fob $ 1000.00

brokers fee $ 1000.00

______________

Duty payable on $7000.00

!!!!!!!!!!!!!!!!!!!!!

[The Jake]

This is NOT about GST, its about  a customs   ruling that : all costs associated with importation/ purchase of a vehicle be it de-reg, inland transport ,entry in Jay ect be included in the FOB invoice and be fully dutiable.

I guess they are including in this the costs paid to a Broker.........

ie: car cost   $ 5000.00

    fob         $ 1000.00

brokers fee $  1000.00

               ______________

Duty payable on $7000.00

!!!!!!!!!!!!!!!!!!!!!

To the best of my knowledge it has always been this way with Customs. I was looking at importing martial arts supplies and when I spoke to the Customs officials about it this is what I was told. Why is everyone so suprised by this? Is this something new with import cars? I would have imagined that anyone that's running an established business shouldn't be caught off guard by this.

- J.

[sewid]

Hmm... ok so you paid $1000 in Australia for broker fees. You already paid $100 GST on top of that.

Do they want to charge duty + GST on top of the 1100? So you pay GST twice - I cant see how that works. So say they want to charge duty on the $1000?. Ok $150 big deal take it you nazi. If the government want's to spend time and money investigating me over $150 i would rather just hand it over to them.

[lwells]

The Jake: The reason people are irritated is because its totally irrational. To use a metaphor: if you use a buyer's advocate to buy a house for you, their service charge is not included in the final purchase price of the house (upon which such taxes as stamp duty are charged).

Why should an import brokerage fee be any different as they are fufilling the same basic service? Yes their fee should include a GST charge (as its a service), but it shouldn't be considered a component of the vehicle's purchase price.

It is completely illogical, and I think (as I said) any decent lawyer should be able to drive a truck through it. The question is (and sewid alluded to the problem), who is going to engage a solictor rather than just pay off the $150-odd ?

LW.

[The Jake]

Hmm... ok so you paid $1000 in Australia for broker fees. You already paid $100 GST on top of that.

Do they want to charge duty + GST on top of the 1100? So you pay GST twice - I cant see how that works. So say they want to charge duty on the $1000?. Ok $150 big deal take it you nazi. If the government want's to spend time and money investigating me over $150 i would rather just hand it over to them.

Yes that is correct. You effectively pay it twice. It's bullshit and I don't understand how or why but that's the way it is and has been for some time to my understanding.

- J.

[The Jake]

The Jake: The reason people are irritated is because its totally irrational.  To use a metaphor: if you use a buyer's advocate to buy a house for you, their service charge is not included in the final purchase price of the house (upon which such taxes as stamp duty are charged).

Why should an import brokerage fee be any different as they are fufilling the same basic service?  Yes their fee should include a GST charge (as its a service), but it shouldn't be considered a component of the vehicle's purchase price.

It is completely illogical, and I think (as I said) any decent lawyer should be able to drive a truck through it.  The question is (and sewid alluded to the problem), who is going to engage a solictor rather than just pay off the $150-odd ?

LW.

I didn't say it was *logical*, I just said it's true.

It's been that way for sometime and I think your chances of getting it overturned are about **** all.

The only real people who would have a reason to chase this would be the importer who ships large volumes IMHO but really the only person to truly benefit from it is the consumer and when they're looking down spending a $$$$ to get the car they want, are they really going to balk at a few extra hundred? It's shitty but hey, what can you do... ?

- J.

[regan]

The Jake: The reason people are irritated is because its totally irrational.  To use a metaphor: if you use a buyer's advocate to buy a house for you, their service charge is not included in the final purchase price of the house (upon which such taxes as stamp duty are charged).

Why should an import brokerage fee be any different as they are fufilling the same basic service?  Yes their fee should include a GST charge (as its a service), but it shouldn't be considered a component of the vehicle's purchase price.

It is completely illogical, and I think (as I said) any decent lawyer should be able to drive a truck through it.  The question is (and sewid alluded to the problem), who is going to engage a solictor rather than just pay off the $150-odd ?

LW.

I agree, although the penalty for not-declaring full purchase price, in relation to paying duty will be alot more than $150.00!!!!! may be cheaper to get that lawyer!! Customs are FULL -ON with this kind of thing.

[predator]

I still don't quite understand this from reading all this.. but am I right in guessing - they want to claim the GST on the supplier charges and other things that may or may not go on over in Japan?? If that is the case, I can't quite see the issue, as this is taking place over in Japan. How can the Australian Government try and claim GST on a service or fees that are provided not on Australian soil??

But I'm not tax guy

[Guest]

It is all about people with Broker/Dealer licences in certain states that you pay $1,000 as their cost is part of the purchase price of that vehicle, you have always (or suppose to of) paid Duty and GST on the FOB cost as it helps assess the cost of the vehicle to work out the amount taxable.

One Broker I spoke to this morning for the the East Coast was spoken to 4 Months ago by customs and the way he runs his company no GST or Duty is payable on his fee.

He said if he is a Broker with a Brokers licence he has to pay GST and Duty on eveything including the phone call to Japan as it is deemed as a cost in the purchase of the car.

Ask who ever brings in the cars for you to answer this as the one who knows what he is doing and is honest will tell the truth.

The people who are most concerned are the people who brought in a car with a Broker who has a Brokers licence and didnt declare and pay the Duty and GST as they will come looking for it and have a nice fine for somebody at the same time.

[cowie165]

As lwells said, I feel they are separate issues. IMO the two cases are:

1. Paying a broker (and they forward the money to a supplier)

2. Paying the supplier directly through a facilitated purchase.

I imagine (1) would incur a duty on brokerage and (2) is a separate service fee.

Which name appears on the tax invoice for the purchase of goods? You or the broker?

J-Spec and Prestige don't negotiate on your behalf, they just tell you who to pay your money to. Its a bizarre issue, and definitely agree with everyone who has pointed out that no-one is going to be taking anyone to court over $150. Or maybe you could - and chase up the AQIS steam cleaners at the same time... : )

Mark

[Guest]

The Jake: The reason people are irritated is because its totally irrational.  To use a metaphor: if you use a buyer's advocate to buy a house for you, their service charge is not included in the final purchase price of the house (upon which such taxes as stamp duty are charged).

Why should an import brokerage fee be any different as they are fufilling the same basic service?  Yes their fee should include a GST charge (as its a service), but it shouldn't be considered a component of the vehicle's purchase price.

It is completely illogical, and I think (as I said) any decent lawyer should be able to drive a truck through it.  The question is (and sewid alluded to the problem), who is going to engage a solictor rather than just pay off the $150-odd ?

LW.

On your first point the difference is not to have your Broker take cuts from the seller as well as the buyier which is why certain "Brokers" are being investigated.

On the second point in the Governments eyes a buyiers fee in Japan goes towards the purchase price so why shouldnt the buyiers fee from you Broker.

And on the third point this is just the tip of the ice berg as to why certain bussiness are being looked into for double dipping (from buyier and seller) and under valueing vehicles, it is way more than just $150 dollars.

Most bussiness on the East Coast operate as a "consultant" in the eyes of the law which is why this dosent affect them in any way, it is about bussiness who have a Dealers/Brokers licence.