Vendors slammed for Australia tax silence

IT vendors remaining silent on the price disparity of IT products between Australia and the rest of the world may face the wrath of one of their biggest buyers, the Australian government, according to Labor MP Ed Husic.

The Labor MP for Chifley has been raising the issue of unfair price differences for IT software and hardware in Australia since March, as part of the FairIT for Oz campaign. Amidst the debate over the Mineral Resources Rent Tax legislation on Tuesday night, Husic rose to slam vendors such as Microsoft, Adobe and Apple for not coming to the table and discussing the price differences.

"I suspect these companies believe they can ride out this sustained public focus," he said.

A recent economic note from Treasurer Wayne Swan noted that in the last quarter, there had been a contraction in the prices for computing-related equipment; however, Husic said that Australians are still paying more.

"When we're paying up to 80 per cent more for software, compared to US or UK customers, despite strengthened purchasing power that flows from a historically high Aussie dollar, you know something doesn't add up," he said.

The Productivity Commission has submitted its report to the government on its review of the Australian retail industry, including its look on IT price differences between Australia and the rest of the world. The report is scheduled to be released next month, and Husic — noting that none of the big vendors made submissions to the inquiry — said that companies that are seeking to "ride out" the criticism of price disparity should consider how much the government invests in IT companies.

"There is over $2 billion worth of IT procurement made by the federal government," he said. "On top of this, it is worth noting that under a coordinated procurement contracting framework that was signed between the Australian government and Microsoft in 2010-11, the Australian government spent over $95 million on licences and software assurance through this volume-source arrangement.

"Government spends a great deal on IT software and hardware," he added.

Husic said he intends to ensure that the software and hardware that the government is procuring is not obtained at an inflated price.

"Frankly, I think that we need to ensure that there is value for money for government, for consumers and for small business," he said. "If they think they can ride this out, I would beg to differ, and urge them actually to be a lot more transparent in the way that they approach this issue."