Ex­pect to pay GST on all on­line pur­chas­ing

Otago Daily Times - - BUSINESS & MONEY -

WELLINGTON: On­line shop­pers can ex­pect to start pay­ing GST for all goods they buy from over­seas af­ter Rev­enue Min­is­ter Stu­art Nash said he would ‘‘ab­so­lutely’’ ex­tend the law to cover goods as well as ser­vices.

Nash told New­stalk ZB yes­ter­day morn­ing that the Na­tional gov­ern­ment had not gone far enough when it in­tro­duced the so­called ‘‘Net­flix tax’’ to gather GST on ser­vices and elec­tronic pur­chases such as movies, e­books and mu­sic.

He said that gave an un­fair ad­van­tage to over­seas sell­ers over New Zealand sell­ers.

‘‘It gives a 15% com­pet­i­tive ad­van­tage to [re­tail­ers] over­seas. While our re­tail­ers had to deal with GST, over­seas peo­ple didn’t. It’s the right thing to do.’’

The Net­flix tax kicked in last Oc­to­ber, re­quir­ing sell­ers such as Ap­ple to charge GST on on­line pur­chases from New Zealand.

It came af­ter a re­view in 2015 found the Gov­ern­ment was miss­ing out on about $180 mil­lion a year by not col­lect­ing GST on on­line pur­chases, in­clud­ing $40 mil­lion from shop­ping on iTunes, Net­flix, Spotify and other on­line ser­vices.

How­ever, that did not af­fect pur­chases of goods from over­seas which were worth less than $400. GST has long been charged on goods worth more than that.

It fol­lows moves by Aus­tralia to re­quire New Zealand com­pa­nies such as Trade Me to col­lect Aus­tralian GST on pur­chases sent to Aus­tralian con­sumers.

At present, no GST has to be paid there on im­ported phys­i­cal goods worth less than $A1000 ($NZ1109).

Un­der the change, New Zealand re­tail­ers, sup­pli­ers or man­u­fac­tur­ers who sell a to­tal of more than $A75,000 worth of goods di­rectly to Aus­tralian con­sumers will have to charge Aus­tralian GST (10%) on those pur­chases, in­clud­ing those un­der $A1000. — NZME

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