State treasurers meet to discuss GST on online purchases

CHANGES to make online shoppers pay GST on purchases under $1000 was a key issue at a high-level meeting of state treasurers with their federal counterpart, Joe Hockey, on Wednesday.

The meeting of treasurers came as several states push for GST to be applied to online purchases under the current $1000 threshold.

The threshold currently only applies to items bought from overseas or online worth more than $1000, which means most online sales are not attracting the revenue state governments rely on.

New South Wales Treasurer Mike Baird said he welcomed comments from Mr Hockey that the issue was on the Abbott Government's agenda, despite no decision being made.

Mr Baird said there was a need not only for states to gain the extra revenue from increasing the tax, but also for bricks and mortar retailers to get more business.

He said the physical retail industry in NSW had been stagnating for some time, while online sales in the state were growing 15% every year, partly due to the tax anomaly.

Also discussed was a need, pushed by Tasmanian Premier Lara Giddings, to increase both the rate and base of the GST - a change that various states have supported over time.

But Queensland Treasurer Tim Nicholls said the item wasn't officially on the agenda, and "the only people talking about it are the Labor premiers".

He said while the issue was raised, and all states had publicly stated their position on the GST, changes to the GST formula were "not on the agenda" for the Sunshine State of other conservative states.

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