In December, the most crucial month of retail, the Australian retail turnover fell 0.1 per cent, seasonally adjusted, following a rise of 0.1 per cent in November 2011.

The latest Australian Bureau of Statistics (ABS) retail trade figures indicate the largest contributors to the fall was food retailing (0.7 per cent), followed by cafes, restaurants and takeaway food services (-1.8 per cent).

On the upside, clothing, footwear and personal accessory retailing (3.5 per cent), department stores (1.1 per cent) and household good retailing (0.2 per cent) helped offset the falls.

According to the Australian Retailers Associations (ARA) executive director Russell Zimmerman, it’s clear that consumers were being ultra conservative during their Christmas shopping period.

“Perhaps the most surprising figures were around reduced spending on food and cafes and restaurants compared to November, which could be due to grocery discounting from the big supermarket chains but was also in line with reports of low consumer sentiment and ensuring debt levels were kept manageable. However, when compared to December 2010, food retailing (groceries) were still buoying up the sector with 4.4 percent year on year growth,” he said.

Further, the ABS retail sub categories, showed NEC retailing ‘not elsewhere classified’, which includes pure play online among other things, jumped 14.7 per cent year-on-year.

The National Retailers Association (NRA) said these results highlight the need for urgent reform of the unfair GST and excise arrangements that favour overseas businesses.

NRA executive director Gary Black said the state-by-state breakdown showed all states continued to record very modest growth, with the exception of Western Australia, which is in a world of its own.

“Across the majority of retail categories and the majority of states, we continue to see evidence of the damage being caused to Australian jobs by the unfair tax and import duty loophole that favours overseas retailers,” he said.

“Once again, we warn the Federal Government that its failure to act to level the customs and tax playing field is causing severe harm to the Australian retail sector and is resulting in the shift of thousands of Australian jobs offshore.”