Following a meeting between Federal Treasurer Wayne Swan and all the State Treasurers about GST related issues, a working group will be established and led by Treasurers Mike Baird and Jack Snelling to complete the vital work on lowering the low value threshold.

“That review endorses the current approach and the current approach ensures that all states have the revenues to provide a similar level of services. That's a very, very important conclusion which has been backed in by this independent review, headed by Mr Brumby and Mr Greiner,” Swan said in a media conference.

However, the federal government ruled out any chances of lifting the GST above the 10 per cent rate or broadening the base as it’s the “lazy way” in going about a tax reform.

“The one thing the Commonwealth won't be doing is that we will not be considering any increase in the rate of the GST or any case to broaden the base of the GST,” Swan said.

“That is the lazy way to go about tax reform and doing that would hit the lowest income earners in our community really hard.”

The ANRA has congratulated the Treasurers on recognising the importance of the topic and reaching an agreement.

“The Treasurers have recognised the need for change, with no less than three government sponsored reports from the Productivity Commission, the Low Value Parcel Processing Taskforce and the GST Distribution Review Panel all agreeing. The threshold must be slashed in the interests of State revenues and the local retail sector, now is the time for action on this issue,” she said.

The ANRA highlights it's necessary for the government to act now as many states and territories are missing out on millions of dollars in revenue as overseas retailers cash in on Aussies penchant for overseas online shopping this Christmas.

“That’s schools, hospitals and roads Australian families lose because the GST is not collected on goods imported under $1000 – a genuine loss to our community,” she said.

“Christmas presents and ‘stocking stuffers’ bought locally attract the tax but under a loophole in the law any goods under the low value threshold (LVT) bought from overseas retailers are tax free.

“Calculated over a year the tax revenue figure lost is even greater, with the percentage of sales heading across our borders growing at a staggering rate each year.”