The Australian Competition and Consumer Commission has moved to ensure retailers remedy instances where consumers have been incorrectly charged GST on pre-paid mobile phone cards and starter kits.
Harvey Norman stores in Port Macquarie and Grafton, and the Domayne store in Liverpool have agreed to provide refunds to consumers who have been over-charged.
"In effect, some consumers have been charged GST twice - once on the purchase of the card and again when a call is made", Acting ACCC Chairman, Mr Allan Asher, said today.
After complaints were made to the GST Price Line the ACCC contacted the three major mobile phone carriers, Telstra, Optus and Vodaphone. The face value of the cards represent a GST-inclusive price, and the underlying call charges have been adjusted to reflect any GST liability, eg. a 50c per minute call charge has been increased to 55c per minute to include GST.
"The Trade Practices Act 1974 prohibits businesses from claiming that they must charge extra for GST if no such liability exists", Mr Asher said.
The Harvey Norman franchisees and the Domayne franchisee have agreed to stop charging GST on the pre-paid call cards; offer refunds to consumers for the extra GST charged or, where a card has not been used, the full cost of the card; and place advertisements in local newspapers advising consumers of these refunds.
"Consumers who can show that they have been overcharged more than the face value of pre-paid phone cards should take the matter up with the retailer concerned and seek a refund of the extra amount. The ACCC is continuing to monitor GST charging and will take whatever action is necessary to ensure that consumers obtain refunds", Mr Asher said.
The ACCC has written to retailers identified by complaints to the ACCC GST Price Line. In addition, some carriers have said that they will now print cards to show that call charges include GST.