Moves to slap GST on overseas online shopping purchases worth less than $1000 will be on the agenda when Federal Treasurer Joe Hockey meets his state and territory counterparts this week.
However, the states and territories will need to argue the case for a lower GST threshold on foreign imports, the federal government says.
The treasurers will meet in Canberra on Wednesday from 8.30am for the Standing Council on Federal Financial Relations, the first since the change of government.
A spokeswoman for Mr Hockey said the meeting will focus on economic growth and ways to increase productivity.
The $1000 threshold at which the GST is collected on goods and services purchased from abroad will be on the agenda.
The treasurers will consider potential options on collecting the GST on online transactions if the threshold was to be lowered.
Parliamentary secretary to the treasurer Steven Ciobo says it will be up to the states to argue the case for a lower threshold.
‘‘It’s the state governments that actually reach the agreement and put in place the framework around what the threshold should be and how much revenue should flow back to the states,’’ he told Sky News.
Australian retailers argue that while online shopping from foreign outlets may comprise a small component of the overall sector, it’s a fast-growing trend that is being supported by an effectively GST-free status on less expensive items.
The previous Labor government argued significant reforms were needed within the tax system to offset the cost of collecting the tax.
That was not a concern for the commonwealth, Mr Ciobo said.
‘‘That is one of the factors that the states are going to have to take into account,’’ he said.
Labor frontbencher Bernie Ripoll said the opposition was happy to look at any proposal provided it did not make the system more complex and expensive to run.
‘‘The government has got to do some lifting here, they just can’t blame the states,’’ he said.
Australian businesses argue that while online shopping from foreign outlets may comprise a small component of the overall retail sector, it's a fast-growing trend being supported by an effectively GST-free status on less expensive items.
The previous Labor government argued that significant reforms were needed within the tax system to handle the job otherwise the cost of collecting the tax would outstrip the revenue collected.
NSW Treasurer Mike Baird said his state had been pushing for reform on the low-value threshold on GST for online overseas purchases for a long time.
"It is about time we had a genuine discussion on the issues that matter and it's clear that under the new federal government this is what we are going to see," he said.
The treasurers are also expected to discuss infrastructure partnerships and the economic and fiscal outlook.