Offshore hotel booking websites expected to lose GST exemption from 1 July 2019

[Strategic Aviation]

From income tax cuts to online hotel bookings: Seven more budget changes you should know about - SmartCompany

In a change that will likely bring a smile to local accommodation booking services, the government has announced a plan to recoup $15 million by making offshore online booking providers calculate their GST turnover in the same way as local businesses.

The measure will come into effect from July 1, 2019, and apply to sales made on or after that date, as long as all the states and territories agree.

The current system exempts offshore sellers from including sales of hotel accommodation in their GST turnover, which means they don’t necessarily need to register for and charge GST on mark-ups of whole accommodation prices.

“Removing the exemption will level the playing field by ensuring the same tax treatment of Australian hotel accommodation, whether booked through a domestic or offshore company,” the government said in the budget papers.

Budget 2018: Booking Aussie hotels on overseas websites could cost you more when GST kicks in - ABC News

Australian hotel bookings through overseas websites like Expedia could cost travellers more from next year, following the budget announcement that these companies must start paying the GST.

Websites such as Booking.com, Trivago and Wotif will be expected to pay 10 per cent GST on all sales of hotel accommodation in Australia to "level the playing field" from July 1, 2019.

One tourism industry expert believes the cost will be passed on to customers.

It's understood Airbnb will not be affected by the budget change because it falls under a different rental category for GST purposes, but it could be looked at more closely during the implementation of the policy.

Offshore hotel booking sites have been exempted from paying GST on sales since 2005.

 

[Quickstatus]

How can an ATO force an overseas business to collect GST and remit?

 

[JohnK]

How can an ATO force an overseas business to collect GST and remit?

How does it currently work for Australian businesses selling hotel rooms in say Thailand where they have VAT and service charge?

 

[basso]

How can an ATO force an overseas business to collect GST and remit?

They've managed to for a few overseas sites that target Australians. I'm guessing this extends that