Myer’s chairman Paul McClintock is confident the federal government will agree to demands by local retailers and force offshore online stores to pay GST on low-priced goods next year.
Mr McClintock accused the government of making life difficult for retailers, saying the GST loophole on goods bought overseas for under $1,000 and labour costs were hurting, while economic conditions, the carbon tax and flood levy had hit discretionary consumer spending.
Fellow retailers Gerry Harvey and Solomon Lew have also called for a cut in the GST threshold, with the latter warning thousands of retail jobs would be lost in 2013 if nothing was done.
The loophole allows Australians to purchase goods offshore more cheaply than they can here, which Mr Lew argues makes removing it a politically difficult decision to make.
“My prediction is it will be fixed so we won’t lose the jobs,” Mr McClintock told reporters at Myer’s annual general meeting on Friday.
“It is incredibly unfair to have a situation where people can do exactly the same transaction in different ways and have different tax consequences.
“If the federal government truly values the retail sector, the impact of increasing labour costs and uncompetitive nature of online retailing must be balanced by measures to improve productivity or flexibility.”
Myer described 2012 as a solid year to shareholders, despite the retailer suffering a 12.7 per cent drop in net profit to $139.4 million, with sales down 1.3 per cent.
Chief executive Bernie Brookes expects the current January quarter, which includes the crucial Christmas and Boxing Day sales period, to be flat.
The early signs were good with strong sales in cosmetic gift packs online, hampers and Christmas trim.
“Two quarters of positive sales growth (May to October) is pleasing and has given us a really good base … you don’t suddenly have a good or bad Christmas, you normally build up to a good Christmas,” he said.
Shareholders were told that the struggling department store chain remained at the core of Myer’s business, with improving customer service a key part of its turnaround plans.
About 97 per cent of shareholders approved Myer’s remuneration report, despite opposition from the Australian Shareholders Association about Mr Brookes’ 4.4 per cent pay rise, not including long-term benefits, to $1.9 million in fiscal 2012.
Myer has not paid any bonuses for the past two years, with tough hurdles for them linked to a recent exodus of senior managers, including Judy Coomber who has gone to rival Premier Investments.
Despite the talent loss, Mr Brookes – who must be replaced in 2014 – insists Myer had “significant bench strength” in management.
He would not comment on suggestions Myer is a takeover target, after Premier Investments chairman Solomon Lew said his company was eyeing growth and refused to rule out a takeover bid for Myer or David Jones.
Myer Holdings shares closed down 1.0 cent at $2.16 on a day the overall market gained nearly one per cent.
