Commercial television networks to implement GST inclusive pricing

19 September 2001

All commercial television networks have agreed to alter their price proposal schedules and confirmation sheets to show Goods and Services Tax-inclusive prices, after discussions with the Australian Competition and Consumer Commission, ACCC Chairman, Professor Allan Fels said today.

"The ACCC had received complaints from business consumers that the commercial television networks were displaying and quoting the prices for television advertising time on a GST exclusive basis. The ACCC raised its concerns with the Federation of Australian Commercial Television Stations and the commercial television networks that the quoting of GST-exclusive prices may breach the ACCC's Pricing Guidelines and parts of the Trade Practices Act 1974.

"After industry-wide consultation, all the commercial television networks have agreed to introduce a new confirmation step to direct customers (i.e. those customers who do not book television advertising space through an agency) from 3 September 2001 to disclose the GST inclusive price of television advertising services. This has been implemented to reduce the likelihood that customers may be misled about the full price they have to pay for television advertising.

"The commercial television networks have also agreed to implement GST-inclusive pricing for television advertising services to all customers from 1 January 2002.

"In agreeing to the staged introduction of GST inclusive pricing in the commercial television industry, the ACCC acknowledged industry concerns that full compliance by 3 September 2001 was unachievable due to the need to alter existing systems. Accordingly, the ACCC agreed that a more realistic date for comprehensive and permanent changes would be 1 January 2002.

"The ACCC welcomes the networks' agreement. The risk that businesses may be misled by GST-exclusive pricing is very real as is demonstrated by the complaints the ACCC continues to receive. Accordingly, businesses should take appropriate steps to ensure that their customers know exactly how much they are paying for goods and services before they enter into a legally binding contract.

"The ACCC has been considering other instances of GST-exclusive pricing in business-to- businesses transactions on a case-by-case basis. However, where the ACCC receives complaints from business consumers that they have found either particular business price lists or price quoting practices to be misleading, it will not hesitate to take steps to achieve compliance".

Release number: 
MR 231/01
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