I can confirm from experience that UPS will correctly process bullion imports into Australia over $1000 if clearly marked. There is a declaration that you need to print, sign, scan and return via email, but it was a smooth process. No ABN required.
My order over $1,000 left APMEX yesterday so I will keep everyone posted on the process as it unfolds.
the issue was purely with Fed Ex. the customs officer i spoke to clearly stated that they were fully aware of input taxation etc. and just have a standard blanket policy to charge gst on all shipments and put the onus on the customer to get a private ruling. I will be informing them in my letter demanding a refund that they will lose a great deal of business as i network with a community of people who regularly import bullion and they have now made the shit list.
Perhaps a silly question, but is that legal? Since the ATO has issued a public ruling on the subject there shouldn't be any need to get a private one, especially if FedEx are already aware of the tax status. I can't really see how its different to them trying to charge 20% GST and making you get a ruling that clarifies the rate of GST is only 10%.
This is why it is important to have good relationships with your over-seas dealers. Since you are importing into the country, the onus is on you to have all the documentation in order before it arrives at the port in Australia...even if you are not the person actually filling it out in most cases! (Note: If you have a an account with a freight company or forwarder like DHL, Fedex etc you can fill out the forms yourself and even book a pickup to the bullion dealer so you CAN have more control over the process.) Once it arrives in Australia, if it has the wrong codes etc it just gets automatically processed into whatever bin that is determined by the paperwork on the consignments. There aren't people there with the intention to screw you over, it's just a case of "computer says no." If you order $1500 from an overseas mint, they will just fill out the paperwork in their standard fashion which when it ends up here will likely end up in the brokerage/clearance/GST process. They have no idea about the customs rules in Australia unless you specifically direct them to put the correct tarriff and LPM codes. Even so they can still get it wrong and you'll end up having to try to convince customs that what is on *your* import paperwork is wrong. I have found that it is quite effective to walk into an actual customs office in person and sort it out on the spot. Bring your evidence with you. Never assume anything...
Yeah, but that isn't the same as FedEx automatically witholding GST on everything regardless of whether the paperwork is filled out correctly or not. In their case, even if you fill out the correct paperwork for input taxed, investment-grade bullion they still try to charge you for it even though they know the items are taxed at a rate of 0%.
I seem to recall a line in the Customs or ATO rules that explicitly state something to the effect of "you do not require a private ruling to verify that precious metals are GST free". Will post a link if I can dig it up.
Once the content verified to match the tariff exemption code the items should not even go to custom at all. My last two lage shipment actually come thru like that saving me further shipment delays, my time and money to deal with the custom clearance hassle.
One of my mates received his order from overseas this week which was over $1500. The usual response of trying to charge GST on the order and then when you explain to them it's input taxed, they quote the "it's only for dealers" which is incorrect. As he was prepared for this response he quoted back the relevant sections of the GST act, in which the UPS guy put through his order as "GST exempt" and he just had to pay the customs admin fee of $60. Didn't have to fill out a form He received his package the following day. Funnily enough when he called the ATO as a backup he had to have his call escalated up 3 levels and the person he spoke to was spouting the "dealer" part of the GST as well. When he argued his point, she put him on hold and came back 5 minutes laters, saying yes you are correct the bullion is 'input taxed'. The shipping company that the order was sent through was UPS.
It is amazing that you have to go up 3 levels with the ATO and still can not find a single person who understands a very simple text written in our taxation law. Especially these are the people who supposed to give guidance on the help desk with inquirers. Just imagine for an average Joe asking tax advice from these idiots.
I doubt they're able to recruit the best personnel, it's not the kind of organisation you'd be proud to work for. Could you imagine the reation after telling new aquaintences around a poolside BBQ that you work for the Tax Dept ?
I also went through this process today with FedEx. I ordered approx $3,000 worth of silver from Scottsdale Silver and it arrived in Australia today. The guy from FedEx called me asking for an invoice - so I emailed him the invoice I received. Then later in the day a second FedEx guy (Customs officer) called and said he was processing my parcel and that GST was payable. I advised that I suspected something like this would happen and provided him the with links to the ATO websites. I also provided him with a link to this forum and said that many people have gone through this process previously. I explained the difference between GST Free and Input Taxed. A few hours later a third FedEx guy called to tell me the parcel is going through and I just need to pay Duty (it was about $52, not sure if this goes up or down based on the amount of silver but I ordered 100oz if that helps). I paid with credit card over the phone and the parcel has been released and will arrive tomorrow morning (tracking online). So it wasnt simple - but it was only because of this forum/threat that I had all the answers ready to go. I also have the name/phone/email of the FedEx people I spoke with if anyone gets stuck in the future just PM me - they were all very nice to deal with.
Now that this threads gone quiet..I'll go off on a tangent. I'm reading a book by Malcom Gladwell staff writter on the New Yorker Magazine called "What the dog saw" (and thoroughly recommend it as an interesting read). In 1 chapter 'open secrets' he examines the Enron case starting with the commital of 52 year old CEO, Jeff Skilling to 24 years in prison. The Judge said the case established that the CEO had lied to ENRON's clients and staff about various aspects of the company's business. At this point Gladwell delves into the difference between what is a puzzle and what is a mystery. He explains Osama Bin Laden's whereabouts are a puzzle, because we don't have enough imformation...but eventually that information will be found (by an informant for example). Where as a mystery, for example, what would happen in Iraq after the Gulf War, wasn't about a lack of information but that there was too much information. ENRON's case wasn't a puzzle, argues Gladwell, the company supplied every bit of information asked of it. But the company was so big and complicated, that the paperwork on the 3000 SPE's (Special Purpose Entities used to break up the business into smaller, more manageable lots) that were in question ran to 3 million pages (1 thousand pages each). Summary documents on 20 randomly picked SPE's ran on average to 40 single spaced pages each. Based on that, a summary of all of the SPE's would've come to 120,000 pages...single spaced. A summary of of all these summaries was created by the bankruptcy examiner and it came to 1000 pages. So the Powers Commitee created a summary of the summaries of the summaries and it came to 200 mind numbing pages which was by then so out of context and abstract to be of little use. The more they smoothed over the detail the more they lost track of the risk. Skilling never lied ... sure ENRON was in trouble and he should've known what was going on, but he didn't go to jail because he was a poor CEO either. No one really knows what went wrong with ENRON, not the auditors nor the CEO not even the participants on the trial case. Skilling went to jail because they needed a fall-guy. A lot of people were p!ssed-off and somebody had to pay... and that's not justice!
That is what you sign up for when you become a CEO. But you're right that Enron wasn't a puzzle: they deliberately created markets with the express purpose of manipulating them. That was why they moved to mark-to-market accounting (booking nebulous future profits in present accounting periods) and created divisions like EnronOnline (which only allowed participants to trade with Enron). If nothing else, Jeffery Skilling deserved to go to jail for selling weather derivatives as though a bet on it raining next Tuesday is some kind of legitimate financial product.
Just a final update on my personal saga regarding Fed Ex and GST. I got stooged for a $650 bill from Fed Ex, i applied for a private ruling with ATO, received a favourable ruling within about 3 weeks, emailed the details to Fed Ex and received a reply in about another week, advising me that i would receive a refund and they needed me to either fill out and return a form by fax within 10 days or supply a bank account for a direct deposit. I gave them a bank account, they then took a full 30 days to process and i just received my refund today. So it took almost a full 3 months from the day i paid the bill to get my refund, BUT i did get my money back. UPS on the other hand, correctly process imports and do not automatically charge GST. I would therefore advise everyone to boycott Fed Ex as a courier for all bullion imports and go with UPS as a preferred courier, but if you do get stuck with them, do not let them steal your money - it is a pain in the arse but you WILL get your money back.
