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5489.0 - International Merchandise Trade, Australia, Concepts, Sources and Methods, 2001  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 30/05/2001   
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Contents >> Chapter 10. Emerging Issues >> The new tax system

10.2 The New Tax System (TNTS) was introduced in Australia on 1 July 2000. A number of aspects of TNTS are of interest in the context of future international merchandise trade statistics. These include the introduction of the:

  • Australian Business Number (ABN);
  • Goods and Services Tax (GST); and
  • Business Activity Statement (BAS).

Australian Business Number (ABN)

10.3 Under TNTS, registered businesses receive an ABN and are included on the Australian Business Register (ABR). To register for an ABN, an applicant must be either a company or an entity carrying out an enterprise. Businesses with an annual turnover of $50,000 or more, and non-profit organisations with an annual turnover of $100,000 or more, must register for the GST, while those with a lower turnover may choose to register. Businesses must be registered to participate in the GST system.

10.4 The ABN is a single unique public business identifier. Government policy is that the ABN should be used in all government dealings with business. The ABN will allow businesses to have a single business identifier for dealings with government at all levels. Customs introduced use of the ABN and the associated Client Activity Centre (CAC) in its COMPILE and EXIT systems on 1 July 2000.

10.5 Introduction of the ABN provides significant statistical opportunities for the ABS, including for its international merchandise trade statistics. In Chapter 4 some limitations with current trade statistics were noted. There is considerable interest in knowing the characteristics of businesses involved in the export or import of goods, including the industries to which they belong.

10.6 Information on the trade activity, particularly exports, of businesses and industries has therefore been an area of substantial unmet demand. While some information has been available from ABS surveys, its usefulness has been affected by a range of methodological and coverage problems. It has not been possible to reliably compare trade data with statistical information produced on a standard industry basis.

10.7 The introduction of the ABN provides a better basis for identifying registered exporters and importers. This is expected to be more efficient and to help improve the quality of data reported. Previous identifiers used are specific to Customs and do not always identify the actual trader. The ABS has commenced use of the ABN for these purposes and will progressively expand it.

10.8 Secondly, the ABN will allow all of the import or export transactions relating to an individual business to be brought together and summarised. The ABN provides a more certain and direct link to the business entities registered, enabling data to be presented on a business basis, as well as on the current transaction basis. Previous identifiers used do not permit this as their relationship to the business entities involved can be complex and vary over time. Trade data could not therefore be shown on a business basis and compared with, or used to supplement, information obtained from other sources.

10.9 Finally, the ABN can be used to enable matching, confrontation, supplementation and substitution of Customs data with data from other sources. This enables the ABS to enhance data sets, or create new data sets, without imposing any additional reporting load on businesses. Specifically, the ABS expects to be able to match the ABNs of the actual exporter or importer with other sources, to capture the standard industry codes of those businesses. It will then be able to publish trade statistics on a standard industry basis, consistent with other industry statistics produced by the ABS.

10.10 It is expected to be some time before publication of statistics on the new bases can commence. Arrangements under TNTS have to be established and operated in a stable fashion for some time. The ABS has to undertake various investigations and analyses to establish user requirements and to determine the most appropriate methodology for producing the new data series. Several reference periods are required before users would be able to consider the data in a times series context.

Goods and Services Tax (GST)

10.11 Under TNTS, exports are not subject to the GST i.e. they are 'GST free'. Most imported goods are subject to the GST, with the same range of exceptions as for domestically produced goods. However, imports of goods will continue to be recorded in ABS international merchandise trade statistics on a Customs Value basis, which is before the imposition of Customs Duty and the GST.

10.12 Customs has administrative responsibility for maximising compliance associated with import and export transactions. It administers the calculation and collection of GST payable on the importation of goods, although most importers will be eligible for, and are expected to take advantage of, the Deferred GST Scheme.

10.13 The Deferred GST Scheme is designed to put importers on an equal footing, in regard to the payment of GST, with businesses using goods obtained locally. Participating importers account for the deferred amount of GST on their next BAS lodged with the Australian Taxation Office (ATO). In the majority of cases, the amount of GST deferred is simply offset on the BAS as a full input tax credit.

10.14 As a result of Customs involvement in the GST arrangements, several new data items are available to the ABS. These are GST liability, GST deferred, GST exempted and GST exemption code for imported goods. These data will be stored and evaluated.

Business Activity Statement (BAS)

10.15 The BAS must be completed by all businesses registered for the GST, including government entities. It constitutes the tax return in respect of various tax obligations. It is completed monthly by large businesses, and less frequently by other businesses, unless they opt to report monthly. In normal cycles, businesses reporting monthly must lodge their BAS with the ATO on or before the 21st day of the month following the end of their tax period. For other businesses, the deadline is the 28th day of the following month, with the exception of December quarter returns where the deadline is 28 February.

10.16 A number of data items included on the BAS are of interest for statistical purposes. As exports are GST free, for the purposes of risk management and the GST calculation exported goods are separately identified. The definition of exported goods on the BAS is consistent with that used by Customs. Inclusion of exports data on the BAS creates a potentially useful new data source for this information.

10.17 The ABS will compare exports data reported to the ATO on the BAS with exports data reported to Customs, in order to evaluate the differences between the two data sources. BAS data will be on a business basis, not a transactions basis, and some small businesses may not register for an ABN. It should be noted that, as the taxation treatment of imported and domestically produced goods is the same, imports are not separately identified on the BAS.

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