You can’t say the campaign by the retail lobby against the internet has been a complete failure. It has been very successful at seeding the idea that the current "low value importation threshold" of $1000 is a “loophole”. Henry Rosenbloom, defending the retail oligopoly in Crikey earlier this week, referred to the GST “loophole” several times. And the media routinely refer to the “loophole”.
Well, I guess one person’s loophole is another person’s insidious tax grab, but normally a loophole is an unintended consequence of policy, something unforeseen by bureaucrats and government lawyers when drafting legislation and seized upon by tax dodgers. But the low importation value threshold is deliberate Government policy, not an unintended consequence. And it has been around for decades, long before the GST. Moreover, it has been reviewed on multiple occasions – most recently in 2009.