The GST start date appears to have passed with little more than interested onlookers, such as this correspondent, wandering through the aisles of supermarkets and shopping centres in the vain hope that we might stumble upon some major catastrophe we could report.
However, it was not to be. The start date came and went with little incident.
Some department stores were unable to open at their regular time due to computer systems failing and a few cafés struggled to cope with the conceptual administration issues involved.
The Australian Taxation Office sent its call centre staff home early and all appeared well to Professor Alan Fels from the Australian Competition and Consumer Commission’s point of view.
Even Labor opposition leaders talked about the impact of the GST being at its ferocious worst in December and not on July 1.
Monday dawned as the first day of trade for a number of services.
The ACCC received 4,000 calls and launched its first court action.
Ironically, the action was against a Melbourne-based accountant who allegedly provided advice that residential rent and council rates were subject to the GST.
The Queensland toll roads encountered teething problems relating to the size of the rise in tolls levied but, from a consumer’s point of view, the changeover appeared seamless.
That was always going to be the case.
Business was going to bear the brunt of the administrative nightmare we had been warned about.
Obviously, there are a host of issues that will only become
evident as we implement the tax in all its glory.
For a long time we have said that business will feel the impact at the time that they come to prepare their first Business Activity Statement in three months.
This annual activity will now have to be done every quarter.
However, it is hoped that the systems will be in place to allow this to occur easily.
The major issue for most observers relate to exemptions.
The raft of food types and the need to distinguish between
prepared and unprepared and hot and cold foods is an issue that will not be settled in some cases without legal action.
The inclusion of live fish in the tax net and the exclusion of live crayfish and live prawns is intriguing.
No doubt this issue will be decided by the High Court.
I await that decision with a great deal of interest.
l Economist Suresh Rajan is a director and proper authority holder with Smith Martis Cork and Rajan – financial planners.