Amazon.com’s decision to block Australian buyers is a warning for other countries

Amazon’s decision to block Australian shoppers from its international online marketplaces could have repercussions in New Zealand.

By James Henderson Jun 04th 2018 A-A+

Amazon’s decision to block Australian shoppers from its international online marketplaces, and instead redirect them to its Australian site, could have repercussions elsewhere.

For example, the move, in response to changes to Australia’s Goods and Services Tax (GST), highlights the “peril” of the New Zealand Government’s plan to introduce its own “Amazon tax” locally.

That’s according to the New Zealand Taxpayers’ Union, in conjunction with sister organisation, the Australian Taxpayers’ Alliance.

“The Australian Government’s online shopping tax denies shoppers and families the same consumer choice available to billions of shoppers worldwide,” said Satya Marar, director of policy at Australian Taxpayers’ Alliance, and currently on secondment in New Zealand.

“If this happens in New Zealand, Kiwis will be denied access to about 500 million products, most of which are unavailable locally. So instead of creating a level playing field, it only harms consumers.”

As reported by sister publication ARN, the move comes after Australia’s Parliament last year passed new legislation that will see online retailers compelled to collect GST from Australian customers on overseas purchases worth less than $1,000.

Specifically, the new legislation amends the law to extend GST to low value imports of physical goods imported by consumers, a large proportion of which fall into the IT and technology categories.

Suppliers with an Australian turnover of $75,000 or more in a 12 month period are required to register and charge GST under the plan.

“Last year, an Australian senate inquiry was told that the online shopping tax would not make Australian retailers competitive, would not raise a significant amount of revenue and that the cost of implementing the tax would force major online platforms to exit the market or cease serving Australians entirely,” Marar added. “Now we see these consequences in action.”

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“New Zealand faces the same risk as it introduces its own Amazon tax. The Government wouldn’t need to assist domestic retailers with taxes on overseas competitors if it addressed local pressures such as zoning laws, strict labour regulations and red tape.”