New Zealand government proposes online shopping “Amazon tax”
The government in New Zealand has proposed a new tax that will impact merchants and shoppers trading cross-border. If the GST (general sales tax) measures are approved, they will come into force in November 2018.
Currently GST on imports are not charged on goods valued at less than $400 NZD. But that threshold will be removed and now all goods shipped into the country will potentially be liable regardless of value.
There are two bits of good news for smaller sellers and marketplace merchants selling into New Zealand. Firstly, if you are selling less than $60k NZD (roughly 30k sterling) of goods and services to New Zealanders then you won’t be liable to charge GST on any goods. And neither will the consumer. $60 NZD is the equivalent of the VAT threshold in New Zealand. This exemption clearly illustrates that the new tax is aimed at bigger retailers.
And another aspect of the proposed new system explains why it’s been dubbed as an ‘Amazon Tax’. The marketplaces will be treated like big retailers if they facilitate sales into New Zealand. The likes of eBay and Amazon will be responsible for administering the GST payable, even if a merchant sold the goods and is an individual seller and the market only acted as a venue.
The reasons for introducing the new rules are various but central is fairness to local retailers who are already liable for the 15% GST. And, of course, there will be a revenue upside for the government. They expect to raise as much as $90 NZD from the new arrangements.
I think it’s much fairer to the retailers, you ask anyone here who’s buying a book if they think it’s unfair that they’re buying a book and not paying GST on it. Prices on some products may drop, if you buy a pair of sneakers or a jacket for $200, you pay import duty on that, you pay GST and then you pay processing fees, so you’ll actually pay less. If you’re buying something on Amazon, it will be Amazon’s responsibility to pay tax on that.
– Stuart Nash, Small Business minister
You can find out more about New Zealand GST on the government website here.
“I think it’s much fairer to the retailers, you ask anyone here who’s buying a book if they think it’s unfair that they’re buying a book and not paying GST on it. Prices on some products may drop, if you buy a pair of sneakers or a jacket for $200, you pay import duty on that, you pay GST and then you pay processing fees, so you’ll actually pay less. If you’re buying something on Amazon, it will be Amazon’s responsibility to pay tax on that.”
SERIOUSLY… what is that rant? Is that ad libbed or just summarised for the article?
It’s a great idea – protects small NZ businesses from competitors from overseas who don’t contribute to the local economy.
Shame about yet more pathetic proof-reading from Tamebay though – the govt will raise as much as NZ$90!! Really, that’s about 50 quid…..that’ll go a long way.
Yeah it will be great when the people of New Zealand can not longer buy anything because local small companies do not stock it.
Yeah it will be great when the people of New Zealand have to pay a premium for a product they used to be able to buy at a fair price.
one day every government will find a way of adding a bespoke tax to all internet sales
as they lose revenue from historic sources
What a confusing article! 2nd paragraph indicates that all good will be come liable. 3rd says not if selling less than $60k or 30k. I assume the £ sign is missing from in front of the 30k. Is that per item, per day, per year? Or are the ‘k’s incorrect….in which case I can’t see how it protects smaller retailers…….it protects all retailers selling items of low value. And I agree with dt……£50 won’t go far. Please can you have another go at this Tamebay.