YOU already know to expect to pay more for streaming services from July 1 when the government’s so-called “Netflix tax” comes into effect.
But what you might not know is Netflix has taken the forced tax as an opportunity to roll out a new pricing structure that exceeds the required 10 per cent, with one tier of the service increasing by more than 20 per cent.
WHAT IS THE NETFLIX TAX?
As it stood previously, only imported goods or real property were subject to the GST — a broadbased tax of 10 per cent on most goods and services sold for domestic consumption.
However, from July 1, the “Netflix tax” will see the GST applied to suppliers of digital products and services such as streaming platforms.
WHAT WILL I PAY FOR MY NETFLIX?
While suppliers of digital products will be forced to meet the same 10 per cent price increase seen with other goods and services that fall under the GST, Netflix will increase costs even more.
The company’s website already reflects the new prices, with the basic package increasing from $8.99 to $9.99 a month, the standard package from $11.99 to $13.99 and the premium package from $14.99 to $17.99 - the premium package allows you to stream TV shows and movies from Netflix on four devices at the same time in HD and 4K when available.
This means there has been an 11.12 per cent, 16.68 per cent and 20.01 per cent increase for the basic, standard and premium packages, respectively.
Netflix defended its pricing, saying that since launching in Australia in 2015, we have not changed pricing. “In light of the upcoming GST increase, we will roll out updated plans and pricing starting June 28 in Australia. Members will be notified of the changes via email and service notifications.”