Consumers Benefit From Wholesale Sales Tax
Consumers Benefit From Wholesale Sales Tax Reductions
Close monitoring of price movements by the Australian Competition and Consumer Commission had shown that the great majority of retailers had passed on to consumers yesterday's reductions in Wholesale Sales Tax, ACCC Chairman, Professor Allan Fels, said today.
"ACCC staff visited many retail sites yesterday and found that prices were being adjusted in line with the ACCC's Guidelines published early in July," Professor Fels said. "The Guidelines require that the WST reductions be passed on fully and immediately.
"These findings have been confirmed by the first results of a national snap survey of prices conducted by a professional survey firm for the ACCC.
"This survey indicates that around 90 per cent of prices surveyed had been reduced. Yesterday's survey was conducted between 9 a.m. and 3 p.m.
"Many visits to shops occurred soon after the start of trading and in some cases prices were still in the process of being adjusted. This accounts for a number of the cases where no change was recorded.
"The reductions are in line with ACCC expectations. For example, for televisions the reductions are around six to seven per cent at retail level.
"A small proportion of retailers who did not pass on the tax savings fully to consumers have been identified. These retailers can expect to be contacted by the ACCC for an explanation of why they have not reduced their prices as expected. Such retailers risk penalties of up to $10 million for corporations per offence and penalties of up to $500,000 for individuals. The ACCC will conduct further price monitoring to ensure full compliance with the legislation. The ACCC expects that all retailers will comply with the Guidelines it has issued.
A further comprehensive survey will be conducted at a later date to ensure that the price reductions are sustained and not clawed back by retailers.
"An important part of the ACCC's monitoring has been the hundreds of calls made to its Price Hotline number 1300 302 502. These calls have not only come from consumers but also from retailers. They have provided an opportunity for the ACCC to inform retailers of their obligations in relation to the new tax changes. Calls from consumers will be evaluated and follow up action will be taken where appropriate.
"Whilst it is
still early days, the results of the monitoring are
encouraging", Professor Fels said.