A spokesperson for Ebay Australia has said there is a proposal being considered by the federal government to levy a $5 tax on overseas parcels.

“We’ve been in consultation with the Government and are aware of the paper,” a spokesperson for Ebay Australia told Inside Retail.

Fairfax Media yesterday reported that the federal government is considering ways to balance the bio-security budget, as the growing number of small parcels entering Australia from overseas retailers has raised the cost of security screenings.

According to a discussion paper obtained by Fairfax, the Department of Home Affairs predicts the number of parcels entering the country worth under $1,000 to increase by 31 per cent over the next four years from 38.7 million last financial year.

In comparison, the department predicts the number of high value parcels – which currently incur a $90 tax – will increase by just 10 per cent over the next four years.

The parcel tax would boost the budget by up to $200 million initially and even more in the long-term, as the number of parcels entering Australia continues to rise.

Ebay has “serious concerns over any proposed levy”, a spokesperson said.

“This will hit consumers hard and we’re worried it will ultimately harm Australian small businesses,” the spokesperson said.

The potential parcel tax comes several months after online retailers’ last run-in with the federal government over its decision to extend GST to imported online goods valued at less than $1,000.

When contacted the Department of Home Affairs deferred to Prime Minister Malcolm Turnbull’s answer to a question on whether the government is considering the tax yesterday.

Asked why the government was considering a $5 tax on overseas purchases, the Prime Minister warned that the newspaper reports on the tax shouldn’t be relied upon.

“There’s a big assumption in what you’re saying, so I wouldn’t rely on that just because you read it in one of our distinguished newspapers. As you know the Budget is only weeks away so were not going to comment on the budget. I’ll just leave it at that,” Turnbull told reporters on Thursday.

If the tax proposal makes it through to the budget later this month it could re-ignite tensions in the retail sector between international marketplace giants and established local brands.

Tensions broke out last year over regulation set to come into effect in July this year that will see GST charged on imports valued under $1000.

Australian Retailers Association executive director Russell Zimmerman, who publicly disagreed with both eBay and Amazon in supporting the low value GST move, said it would be important that the new proposal does not flow through to consumers.

“If they want to bring it in that’s fine, consumers shouldn’t have to pay for it it though, it should be paid for by the couriers or somebody else,” he said.

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