A great report from the NAB this morning which seems to debunk the notion that it is leakage offshore through online purchases which is hurting Australian retailing.
In a special edition of the NAB Online Retail Sales Index which undertook some in-depth analysis of actual transactions, the NAB found that “90% of all online transactions were under $100 and this was the case for both domestic and international sales.”
“In contrast, less than 3% of transactions were over $250 and just 0.2% were over $1,000.”
Tiernan White, the NAB’s Retail Sector Head & Head of NAB Corporate (NSW), said in the report:
Since the Federal election, there’s been significant discussion about the lowering of the GST threshold below the current $1,000 for overseas purchases. That issue has become a very hot topic across both the Federal and State governments.
This edition of the NORSI Special Report demonstrates that not only are the majority of online purchases in the very low value range, in fact 49% of all online purchases were below $10. Transaction sizes for international retailers in particular have fallen quite dramatically over the last three years. Between January 2010 and October 2013 average purchase size dropped from $74 to $38.
So there we have it – this whole debate about sales leaking overseas is a furphy and changing the GST on offshore purchases is not going to fix whatever might be wrong in Australian retail.