Comparably high import duties disadvantage Australian businesses, according to a new study from international accounting and consultancy network UHY.
Import taxes impairing Aust business
The study, which examined the import duties of 18 developed nations and the direct effect on their economy, argues that Australia is greatly undermining its domestic competitiveness.
Rowan Wallace, UHY Haines Norton managing partner, noted that consumers and businesses are continuing to receive a relatively raw deal despite a high level of imports.
“Duties of between 5 and 10 per cent on key imported items like white-goods, clothes and some electronics certainly makes Australia an expensive place for consumers, but also for business,” he said.
Mr Wallace notes that as Australia tries to move away from a reliance on a mining-driven economy, levelling the playing field in regards to high-end manufacturing and services is vital.
“At present import duties on components could mean manufacturing facilities in Australia are at a disadvantage compared to an equivalent facility in a low tariff country,” he added.
UHY stressed the creation of multiple free trade agreements noting a direct impact on international competitiveness: “Many are benefitting from spreading their net far wider than purely their immediate geographical neighbours”.
While acknowledging that an examination of import duties is a useful indicator of trade barriers and economic competitiveness, UHY notes there are other taxes and factors that can have a direct impact.
“Australia for example has a luxury car tax of 33 per cent for imports that exceed defined price limits. China, in addition to higher import duty rates on foreign luxury goods, enforces a consumption tax on goods such as alcohol, tobacco, cars and cosmetics, products where the most popular brands are often foreign.”