Senate Employment, Workplace Relations, Small Business and Education References Committee
11 March 1999
Senator Jacinta Collins
Chair
Senate Employment, Workplace Relations, Small Business and Education References Committee
Parliament House
Canberra ACT 2600
Attention: John Carter, committee secretary
Dear Senator Collins
The Australian Library and Information Association (ALIA) thanks your Committee for the invitation to give evidence, on 19 February, regarding the effects of the proposed new tax system on Australian libraries. The Committee requested further information on the following matters arising out of the Association's submission.
- Definition of books and serials in relation to a GST exemption for books
The recommendation under point 2 of the submission calls for an exemption of books and serials. In this context it refers specifically to printed books and serials and generally does not refer to other formats and substitutable items currently subject to sales tax. An example of a definition as applied to a GST is that of Canada where the library sector has been successful in gaining an exemption on reading materials for libraries and schools which receive a rebate of 100 per cent of the GST on purchases of books and those periodicals bought by subscription and containing five percent advertising or less.
- Impact on the government if books and serials are exempted from the GST
The library and information sector has not undertaken specific modelling on this matter. However the Association refers the Committee to the submission by the Australian Publishers Association (APA) and particularly Appendix III Table showing revenue foregone by removal of GST from books which includes libraries. The APA anticipates 'that revenue foregone by the Government (ref. Appendix II), were books to be given a GST-free status, would be immaterial compared to the benefits that it would bring by encouraging reading, literacy and education.' While printed books and serials will remain a significant component of library resources for the foreseeable future the percentages of the mix of formats of information resources are changing. These formats, including items such as electronic information, video- and audio-tapes, comapct discs, are subject to varying rates of sales tax and can be substitutable goods for books. For example, expenditure on electronic resources in academic and research libraries is increasing each year as more electronic publishing becomes available and licensing arrangements more open. The percentage increase would generally not be as high in school or public libraries. It is difficult therefore to quantify the impact on the government over time from library purchases if books and serials are exempted.
- The impact on employment of a GST applied to books and serials
There is no modelling available on the impact on employment in libraries of a GST applied to books and serials. The Association refers the Committee to the modelling provided in the submission of the Printing Industries Association of Australia on the impact on employment in the printing and publishing sectors.
As a final point, the matter of cash flow problems resulting from the requirement for quarterly reporting and quarterly rebates was raised. I understand that this matter was resolved through advice from the Treasurer's Office that libraries will have the option of reporting monthly.
Yours sincerely
Jennefer Nicholson
Acting executive director
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