ASGA claims import threshold victory

The long-awaited Productivity Commission today handed down its draft report on Australian retail and among a range of recommendations, included a reduction in the low value importation threshold.

Says executive director of the Australian Sporting Goods Association and spokesman for the Fair Imports Alliance, Brad Kitschke, “This is a victory for ASGA and the work that we have undertaken to campaign for reform on behalf our members.

“A lower threshold will deliver measurable benefits to our industry and to ASGA members.”

The Productivity Commission – Economic Structure and Performance of the Australian Retail Industry – was set up earlier this year to to prepare a report on the state of the retail sector, with the government seeking a broader review of all issues affecting retailing's competitiveness and productivity, including online.

Says Kitschke,“ The Productivity Commission has identified that there is an in-principle need to reduce the low value import threshold. This is a very important finding...and great news for retail.”

However, The Fair Imports Alliance is “concerned that the commission has found that while the threshold should be lowered, it cannot be reduced because of the inefficiency of parcel handling processes and the operations of Customs.

“Retailers are already embracing online trading. They are not opposed to online retail and more and more Australian retailers are engaging in a multi-channel approach, but the commission has made it clear that to be able to compete online they need this threshold reduced,” says Kitschke.

“There is also a serious case for a reduction in tariffs. This can only lead to cheaper prices for consumers, says Kitschke.

• Other recommendations from the commission include examining the impact of planning, zoning and trading hour laws on productivity and competition, along with skills training and employment, tenancy leases and the overall role of retail in Australia.

The commission said regulatory reforms are needed for the Australian retail industry to "adapt successfully to the more globally competitive market in which it now operates".

Commissioner Philip Weickhardt said that “intensified retail competition is a boon for consumers, but it is challenging for a retail industry which, overall, has lower levels of productivity when compared internationally and, in many cases, faces higher costs.

"However government's role is not to shield the industry from competition but to remove constraints which restrict the industry in responding to this heightened level of competition."

The commission is recommending that state and local governments reform regulations that "hamper the ability of retailers to respond to changing consumer preferences, including planning and zoning regulation and retail trading hours' restrictions.

"The Australian Government also needs to review any constraints imposed by workplace relations regulations which may impede retailers in improving their productivity and lifting customer service levels," the report states.

The commission is proposing that the Australian Government establish a task force to investigate lower cost approaches to processing in both the mail and courier systems, with a reporting deadline in 2012, a suggestion which does not meet with the approval of the Fair Imports Alliance.

Says Kitschke, “Retailers should not be punished because the bureaucracy is inefficient. We don’t need another taskforce or a talkfest. We need action.

• The commission is calling for submissions on the draft report, with a deadline of September 2.

Pictured: Brad Kitschke (right) with Kevan Gosper, keynote speaker at ASGA's 2010 industry forum

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