Retailers praise expansion of GST to small online purchases

RETAILERS have praised the Federal and State treasurers' decision to remove the $1000 GST-free threshold for imported goods.

State and territory treasurers and Joe Hockey yesterday agreed to remove the threshold in 2017.

Retail Council chief Anna McPhee said the reform would keep the tax system "fair and efficient".

"This is sensible reform that delivers greater consistency in our consumption tax system and will mean similar goods and services consumed domestically are taxed equally," she said.

Announcing the change to the media, Mr Hockey denied expanding the tax was a broken election promise.

"These are integrity issues. If there is leakage of the GST, it is our responsibility ... unanimously with the states and territories to plug the hole," Mr Hockey said.