Nasty Change to Australia’s Tourist Refund Scheme

Claim Back GST with the Tourist Refund Scheme (TRS)
TRS office at Sydney Airport. Photo: Matt Graham.

Australia’s Tourist Refund Scheme (TRS) has long been a popular way for international travellers to claim a refund of the tax paid on expensive items being carried out of the country. But a recent change has rendered the scheme a lot less useful than before for Australians heading overseas on short holidays or business trips.

With the TRS, you can claim back the Goods & Services Tax (GST) or Wine Equalisation Tax (WET) on items bought in Australia within 60 days prior to leaving the country. The items need to be worth at least $300, and you need to show the physical items and original receipt/s at the TRS office at the airport. If the item is worth more than $1,000, the receipt also must have your full name on it.

This makes the TRS useful if you want to claim the tax back on purchases such as computers, phones, jewellery or anything else that meets the criteria.

Previously, it was also possible to bring these items back into Australia at the end of your trip, up to the duty-free concession of AU$900 per adult, or AU$450 per child or airline crew member. This concession can be pooled when multiple people are travelling together.

Goods up to this value (other than commercial goods) that have been purchased overseas, or at an inbound duty-free shop in Australia, can still be imported into Australia without being subject to GST. Goods previously exported from Australia, that had had the tax refunded, were also previously included in the duty-free concession if the items were brought back into the country.

But around September last year, the Australian government changed the rules. If you return to Australia with items you’ve previously claimed a GST refund on, you must now declare these and repay the tax in full. This includes items worth less than $900.

The Australian Border Force (ABF) website was quietly updated around September 2021, but the change was not well-publicised. The new rule has recently caught some travellers leaving the country by surprise.

Below are screenshots from the ABF website. The screenshot on the left is from August 2021, and the image on the right is from October 2021:

The TRS rules on the Australian Border Force website in August 2021 (left) and October 2021 (right)
Before and after: The TRS rules on the Australian Border Force website in August 2021 (left) and October 2021 (right).

As you can see, travellers are now required to declare any items for which a tax refund has been claimed if bringing them back into the country. This previously only applied to goods over the $900 passenger concession.

An AFF member who flew to Singapore last week also noticed that their TRS receipt said:

If TRS goods return to Australia they must be declared and the full refund paid back. TRS goods are not included in your passenger concession. Penalties apply to undeclared goods.

The ABF webpage about duty free concessions also now states:

If you return to Australia with goods for which you have claimed a GST refund under the TRS on departure, you must declare those goods at Question 3 on the Incoming Passenger Card (IPC).
GST refunds received on goods claimed under the TRS will have to be repaid if the items are brought into Australia.

This change won’t have much impact on international tourists, who can still use the TRS to buy products in Australia and get a tax refund when taking them back home with them. This is primarily what the scheme is designed for, anyway.

But this change closes a loophole that has been used by Australians for years to claim GST back on recent purchases when travelling overseas for a short holiday or business trip. The result may be that more Australians choose to make large purchases overseas instead of supporting local Australian businesses.

 

Join the discussion on the Australian Frequent Flyer forum: New TRS rules? Goods no longer included in cap?

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Matt Graham
The editor of Australian Frequent Flyer, Matt's passion for travel has taken him to over 60 countries… with the help of frequent flyer points, of course!
Matt's favourite destinations (so far) are Germany, Brazil, New Zealand & Kazakhstan. His interests include economics, aviation & foreign languages, and he has a soft spot for good food and red wine.

You can contact Matt at [email protected]

Community Comments

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So after being stuck in Fortress Australia for last 2 years I've managed to finally get out of the country with a short trip to Singapore. At the airport, I claimed the GST refund on a mobile phone worth $850 and was on my merry way. I then had a careful look at the TRS receipt and it looks like any TRS goods are not included in your incoming passenger concession:

"If TRS goods return to Australia they must be declared and the full refund paid back. TRS goods are not included in your passenger concession. Penalties apply to undeclared goods"

The ABF TRS site seems to confirm this wording

The officer who processed my claim at the airport made no mention of this. It looks like TRS for Australians returning with the original goods claimed is no longer possible, am I missing anything or has someone who has claimed TRSand returned recently got any experiences to share?

I think that this is just slightly clumsy wording. You do not need to declare these goods if they fall under your TOTAL $900 concession and as such no GST would be payable. This is as per the incoming Passenger Card and I assume the new electronic one. If you exceed the $900 then the full GST would have to be repaid. This is the same as it has been for a number of years.

Of course this is only my opinion. Only Border Force can give you a firm ruling.

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click to expand...

When returning its the current value of the good that matters not the purchase price before departing. As oon as you use a phone or computer it is used and therefore of lower value ;)

Reply 1 Like

When returning its the current value of the good that matters not the purchase price before departing. As oon as you use a phone or computer it is used and therefore of lower value ;)

It used to be 20% after first use but I am not sure what they use today.

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The officer who processed my claim at the airport made no mention of this. It looks like TRS for Australians returning with the original goods claimed is no longer possible, am I missing anything or has someone who has claimed TRSand returned recently got any experiences to share?

You're not missing anything - unfortunately, the rules have in fact changed. You're now required to declare any goods for which you claimed TRS if bringing them back into Australia, and pay the tax back on them.

This change wasn't publicised by the Australian Border Force but I did some digging and as far as I can tell, their website was updated with the new rule around 28 September 2021.

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That does seem odd since we’ve always been able to buy local DF and bring it back either within your limit or declare it. Even before TRS was introduced.

A work around would be to go a DF store (if they still exist?) and do the old sealed bag routine? Or purchase at the airport….

Unfortunately, DF shops were never particularly price competitive (compared to TRS where you can buy from just about anywhere) but for something like an iPhone it could work. But you don’t get to set it up and use before you travel - the other big advantage of TRS.

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Interesting. Was comparing between buying something here or overseas. Thanks for the update. Wouldn't have picked that up. Without the concession, it's cheaper overseas. I can see this will impact local retailers to some degree, but I guess it was a loophole before and therefore not the intent of the concession.

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Possibly I will sell the duty free to a fellow traveller, who happens to be on the same return flight prior to arrival, but it will be interesting to see the cost of enforcing this, against the GST lost. In my last 6 overseas trips I have yet to see a baggage checker from customs except for the card collectors. And with no more cards, it will only be the traffic wardens at the exit barriers

Reply 1 Like

Possibly I will sell the duty free to a fellow traveller, who happens to be on the same return flight prior to arrival, but it will be interesting to see the cost of enforcing this, against the GST lost. In my last 6 overseas trips I have yet to see a baggage checker from customs except for the card collectors. And with no more cards, it will only be the traffic wardens at the exit barriers

There are definitely still cards.

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but I guess it was a loophole before and therefore not the intent of the concession.

I thought the reasoning was so that Australians spent their duty free allowance in Australia rather than overseas. I mean it will now ultimately hurt Australian retail. Whether its by much i'm not sure, but I'll certainly now look to buy overseas on my trips instead of buying from an Australian store and taking OS.

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Nice way to disincentivise going to local stores to get your GST exemption (and also incentivising purchases over the limit overseas and not declaring them on the way back in)...

What a silly decision.

Reply 6 Likes