This is happening because we have bad laws for GST on precious metals. If the Perth Mint are doing this then I should be allowed to keep doing this as well. It's ridiculous to have 10% GST on Australian $200 coins just because they have a little copper in them. Since gold is a form of money, in the near future all gold in all forms will be tax free, GST, capital gains and all taxes free. Silver and platinum are harder to deal with because they are mostly commodities used in industry and should not be hoarded. I propose 10% GST on silver and platinum and other precious metals in all their forms and 999 bars unless they are government minted coins.
Gold fraud: $550m tax scam hits gold industry
- Thread starter whinfell
- Start date
SilverGull
Member
Or don't charge gSt on silver and gold.whinfell said:
bron.suchecki
Well-Known Member
I suspect this story is an attempt by ATO to exert pressure on the govt to change the law. It is not coincidental that this article comes out just after our Federal election - the ATO knew that it had no chance of it getting traction before then as both political parties do not want to make any changes to our GST (sales tax) law as the every interest group will be clamering for removal of tax on their pet good and it becomes a no win political nightmare.
IMO the problem is that it becomes impossible to clearly define bullion vs non-bullion. At the boundry of the definition there is always room for scams. IMO the law should changed so that there is a 10% sales tax on the value added to the raw gold in the item, ie the fabrication cost, only. As a formula it would be GST = Absolute(sale price - metal value) x 10% - FYI the "absolute" covers buybacks below spot - if you are buying back below its real value then that is an implied fee or value add for refining the gold, that would stop all the scams dead. The business would have to be able to prove the fine metal content of each item and the value of the fine metal at time of sale re international prices, if you don't have an inventory system that records that level of detail then 10% on the total sale amount. For real bullion dealers that would not be a problem, for jewellers and other that would probably be too costly re GST saved for the customer so they would bother. Simples.
My concern is the above is far too simple for the ATO and they would rather just charge 10% on everything including bullion but that would be a mistake, as people would just then migrate to pooled accounts, ie finalisied forms of gold investment and physical gold sales would dry up, so less tax recouped.
The spin by the journalist is so biased, it is as equally regulated as other industry who deal in cash and are high risk AML.
IMO the problem is that it becomes impossible to clearly define bullion vs non-bullion. At the boundry of the definition there is always room for scams. IMO the law should changed so that there is a 10% sales tax on the value added to the raw gold in the item, ie the fabrication cost, only. As a formula it would be GST = Absolute(sale price - metal value) x 10% - FYI the "absolute" covers buybacks below spot - if you are buying back below its real value then that is an implied fee or value add for refining the gold, that would stop all the scams dead. The business would have to be able to prove the fine metal content of each item and the value of the fine metal at time of sale re international prices, if you don't have an inventory system that records that level of detail then 10% on the total sale amount. For real bullion dealers that would not be a problem, for jewellers and other that would probably be too costly re GST saved for the customer so they would bother. Simples.
My concern is the above is far too simple for the ATO and they would rather just charge 10% on everything including bullion but that would be a mistake, as people would just then migrate to pooled accounts, ie finalisied forms of gold investment and physical gold sales would dry up, so less tax recouped.
The spin by the journalist is so biased, it is as equally regulated as other industry who deal in cash and are high risk AML.
2nd_Hand_Gold_Man
Member
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Golden
Member
This is also happening here in Europe, where tax on non-bullion gold can be up to 27%. Now imagine the profits.
Any yes, they are trying to blame the dealers/scrap buyers here also. Because they are close at hand, legit business, easy to bother, while real criminals are gone with the wind.
Any yes, they are trying to blame the dealers/scrap buyers here also. Because they are close at hand, legit business, easy to bother, while real criminals are gone with the wind.