Harvey won't stop at GST: Kogan

Harvey won't stop at GST: Kogan

Summary: Aussie electronics entrepreneur Ruslan Kogan has warned that billionaire retailer Gerry Harvey won't stop at getting his way over GST and duty regulations for offshore retailers, but could ask for additional tariffs or subsidies.


Aussie electronics entrepreneur Ruslan Kogan has warned that billionaire retailer Gerry Harvey won't stop at getting his way over GST and duty regulations for offshore retailers, but could ask for additional tariffs or subsidies.

Ruslan Kogan

Ruslan Kogan (Ruslan Kogan image by KoganTech, CC 2.0)

Kogan told ZDNet Australia that Gerry Harvey's campaign is missing a crucial point: Australian income tax.

"Does Mr Harvey realise that offshore retailers don't pay Australian income tax either?" Kogan asked.

"Forget about the 10 per cent GST issue, income tax is a 30 per cent charge. This means that a Hong Kong retailer may only pay 10 per cent or 15 per cent tax on his profits, when Harvey Norman pays 30 per cent," Kogan explained.

"Don't be surprised if you hear Gerry asking for subsidies, tariffs or quotas to protect him from international retailers operating in lighter tax jurisdictions," he warned.

Retailers including Myer, David Jones, Harvey Norman and Target have all signed onto a campaign, lobbying the Federal Government to impose the goods and services tax on all goods obtained over the internet.

The bloc of retailers claimed in major newspaper advertisements that failure to act would lead to "a reduction in hours and shifts for casual and part-time workers, and ultimately cost Australians jobs in retail, manufacturing, logistics and related services".

The Productivity Commission has launched an inquiry into the issue.

"The government is taking it seriously by conducting an inquiry. The problem is that Gerry Harvey is used to getting his way, so when the government says that they need to do some research before changing policy, Gerry throws a fit," Kogan said.

"Unfortunately, it appears that he's more interested in lobbying the government than running his own business," he added.

Gerry Harvey told News.com.au today that while Australian shoppers may pay more for their purchases onshore, it was the right thing to do in order to protect local jobs.

"Yes, you might have to pay more, but it's the right thing to do. You'll pay a lot more if we lose jobs and retailers close down," he said.

Topics: Government, Government AU, Hardware

Luke Hopewell

About Luke Hopewell

A fresh recruit onto the tech journalism battlefield, Luke Hopewell is eager to see some action. After a tour of duty in the belly of the Telstra beast, he is keen to report big stories on the enterprise beat. Drawing on past experience in radio, print and magazine, he plans to ask all the tough questions you want answered.

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  • Gerry Harvey answer me this : Why do I have to spend money at your store for Australians to keep their jobs ? You're a billionaire. You can afford to keep them employed dusting off the expensive products on your shelves for decades. Why should I be the only one who is patriotic ? How exactly I you doing the "Australian" thing in this equation ? By selling only Australian made products ? Buy purchasing from Australian suppliers ? By not minimizing your taxes owed to the tax office ?

    Buy buying from your stores, am I allowing Australians to keep their jobs or just simply making your richer ?

    The former I can do. The latter, when hell freezes over.
    Azizi Khan
  • Forget about the overseas thing, I made the mistake of buying a laptop from Harvey Normans, and just two weeks later spotted the exact product in another Aussie bricks and mortor shop for $500 less. So, even if he gets his way, I will not be shopping at his store again.
    And as for saying jobs will be lost, I thought extortion was illegal...
  • How naive to suggest this your ignorance on this issue is disturbing.
  • I don't think that Gerry Harvey is endearing himself to anyone on this subject. There was obviously a good reason why the Howard Govt didn't levy GST on imports under $1000 and that is probably due to the fact that it would cost more in administration than it is worth. If Gerry is prepared to pay for the administration costs of his proposal then I have no problem with paying it, but while it is at the expense of the taxpayer I have serious issues when a tax costs more to administer than it add to general revenue.
  • If you are refering to me, try looking up the definition of extortion...
  • "Gerry Harvey told News.com.au today that while Australian shoppers may pay more for their purchases onshore, it was the right thing to do in order to protect local jobs."
    I love that. It's the old "lost jobs" magic bullet excuse that justifies any ridiculous statement.
    It's unbelievable that Gerry Harvey should say that Australian shoppers should "pay more".

    Hopefully the popular media will pick this up and make Australian shoppers more aware that they have been ripped off by GH for years.
  • Well they will have to find a way to make it cost effective. If more and more sales happen online with overseas merchants which seems to be a recent trend, the government will find their tax revenue being impacted by not taxing this.

    As a simple fairs fair, our online retailers have to add 10% to all their sales. So either we scrap the GST for all sales under $1000 or find a way of adding it to all overseas transactions.

    No I don't think 10% GST is going to change the public buying practices but it does help to a small degree to level the playing field, then it is up to retailers to make an effort to make shopping with them attractive to consumers.
  • I do agree Harvey Norman stores are over priced compared to some of their competitors, it is your choice if you shop there or not.

    I do agree however in paying a little more (within reason) to support local jobs. As local conditions in some overseas markets make it difficult to compete on some product pricing. In Australia we pay a wage plus superannuation, holiday leave and the like which is not necessarily the case in some overseas markets so I can understand some price differences.
  • How did Gerry get so rich. Selling Open Office (free download) in store for $149 a pop. What a rort. I constantly see Harvey Norman selling goods above manufacturers RRP.
  • If GBE is referring to you zothen, then he must be related to, or is working for Gerry Harvey. Your comment was spot on, and I agree with you wholeheartedly. I also shopped at Harvey Norman recently and bought a computer from them at their Chatswood store, and the sales guy who assisted me there, certainly did not earn whatever commission he made. I would have preferred a discount, rather than having to accept his (the salesman's) input and recommendation.
  • Jerry, who was it that imported cheap goods from overseas that sent our manufacturing industry to the wall and once local manufacturers were gone, then raised their prices to maximise profits

    Pretty similar to what supermarkets are now doing to our farmers - forcing down farm gate prices with the threat of imported fruit and vegies.

    Jerry, you make me sick claiming its un- Australian to bypass you and your kind to get a fair priice on a product.
    I suspect the buying and selling policies of your gang of major retailers have put more Australians out of work than any online overseas purchase will.
  • Right on visions1. I tend to agree with you. It has become the norm for big business to wreck local small business then push up prices and thus profits. All at our expense.

    If we are going to buy product produced overseas, then why not buy it direct rather than paying the middleman and the retailer who probably brought this situation on themselves.

    The main concern of course is that warranty is not handled locally.
  • I agree when I saw Jerry wring his hands and moaning he just wanted a level playing field! wow give me a break please.
    Blank Look
  • Did you report this to OpenOfficeOrg? If there has been a breach of the GPL, OOo could certainly use the money!
  • Myer, David Jones, Harvey Norman & Target have been working a very high profit margin, thus their products are overpriced. If you think you are charging customers for what your products are worth, what are you afraid of? The truth is, you are all getting cheap stuff from China and making customers pay through the nose for cheap labour made products from China. One example, I bought a backpack for $35 at Kmart and the same thing is $55 at Myer, we are not even talking about online trading here, I guess, you may never get it, but don't complain for losing customers if your can't make your items more affordable.
  • According to this mornings radio report, the Xmas period was a boon for retailers, with Aussies spending $6.97B, up 3% on last year, so...
  • The point is Wally that while Gerry whinges about lost sales/lostGST/online buying, retailers had a bumper Xmas... hellloooo. 2 + 2 = 4

    And speaking of trolls, the day you actually say anything of topical substance, without including me (your hero) which even mwil19 was amazed at your, fixation with me...

    Is the day you can refer to another as troll, until then grow up...!
  • No news recently. Has this cooled down already