Kiwis to be hit with tax on online purchases

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Forums › Finance and wealth management › Kiwis to be hit with tax on online purchases

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#1901420 15-Nov-2017 19:08

And what about my Uk amazon count digital purchases (Kindle) and SVoD subscriptions?

The there’s my US ITunes account (set up when NFlix and iTunes movies were pretty much impossible otherwise).. that makes it the local banks who have to try trace these purchases?

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#1901422 15-Nov-2017 19:17

To add to my post above, they would appear to have no logical option but to add those costs.

Why? Well, either they're necessary or they aren't. They can't be only necessary on items above a certain amount can they?

Finch

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#1901428 15-Nov-2017 19:52

Any idea when this will come into force? By the end of the year or next year sometime?

Do I need to rush to buy things online for Xmas now or no? :)

surfisup1000

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#1901434 15-Nov-2017 20:17

Didn't any of you listen? This is exactly as it was under national, they were looking at it.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11944434

Finance Minister Grant Robertson backpedals on 'ambitious' Stuart Nash over GST

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#1901442 15-Nov-2017 20:34

surfisup1000:
Didn't any of you listen? This is exactly as it was under national, they were looking at it.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11944434

Finance Minister Grant Robertson backpedals on 'ambitious' Stuart Nash over GST

The OP was referring to the Nash article. This state,ent appears to have come out late today.

JimmyH

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#1901446 15-Nov-2017 20:36

gcorgnet:

Bottom line is this won't help anyone except maybe the government by raising tax revenue.

Maybe.

I thought the reason for not collecting GST/duty when it was under a certain amount was because the overhead and other costs of collecting the payment would likely be more than the payment itself. Collecting $200 million odd (if the not exactly unbiased Retail NZ estimates can be believed) by eliminating a loophole in the GST net sounds like a good idea. And it is. Providing it doesn't cost most of, or even more than, that $200 million to collect it.

Anyhow, while it may close prices up marginally, NZ retailers are dreaming if they think it will meaningfully boost their competitive position compared to offshore sellers. In my experience, on the things I buy their price differential is typically 300-600% not 15%, their range is worse, and their service is worse. It's more than price, frequently NZ retailers don't stock what I want at any price.

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#1901448 15-Nov-2017 20:38

Finch:

Any idea when this will come into force? By the end of the year or next year sometime?

Do I need to rush to buy things online for Xmas now or no? :)

Apparently the quote was that they are definitely doing this.

And then a few hours later they're only looking at doing it.

vexxxboy

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#1901453 15-Nov-2017 20:52

Batman:

Finch:

Any idea when this will come into force? By the end of the year or next year sometime?

Do I need to rush to buy things online for Xmas now or no? :)

Apparently the quote was that they are definitely doing this.

And then a few hours later they're only looking at doing it.

because there was a reason it was $400 and over because anything under that was going to cost more to collect than it would raise. The last government knew this which is why they hadn't done anything.

Common sense is not as common as you think.

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#1902462 15-Nov-2017 21:37

Geektastic:

How about these costs

Import entry transaction fee (IETF) – NZ$29.26
Biosecurity levy – NZ$19.98

Can we look forward to those being added to every $2 purchase as well?

Here's part of the problem.

These charges apply to every item that enters NZ. They are however only collected when the de minimis value for GST and duty is exceeded.

These charges need to be applied to every item that now has GST and/or duty applied to it. If they're not the system isn't a fair one.

The white paper put out by Customs has some great content in it including the fact it's simply not possible to collect tax on all imported goods as it will potentially cost more to process than what it will gain. This is why we have the de minimis value at present. Targeting big online retailers and getting them to collect the GST is the only realistic way to do this - but the big question is how many will sign up to this.

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#1902463 15-Nov-2017 21:39

I feel sorry for the woman from Unity books who was on RNZ and was so excited by the fact it's going to positive for her. I'm not sure why her (and many others) think this will be a game charger. Yes it's entirely fair that GST is collected and I have no issue with that - but when I can still import goods for a much cheaper price even paying GST then I'll continue to do that.

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#1902492 15-Nov-2017 23:14

KrazyKid:

And what if Ali express outright said no, we won't collect this tax. What could the government do? It's not like they can make a Chinese company do anything.

The Govt could stop all aliexpress items.. and start charging a $50 fee.. per parcel.. that would soon get aliexpress paying the GST i their goods were not getting through the border to customers..

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#1902493 15-Nov-2017 23:18

Geektastic:

How about these costs

Import entry transaction fee (IETF) – NZ$29.26
Biosecurity levy – NZ$19.98
Can we look forward to those being added to every $2 purchase as well?

Sure can.. if aliexpress or such doesn't play nice and collect GST & pay to NZ

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#1902494 15-Nov-2017 23:37

Retailers also seem to forget that there are Many things sold only by the company that makes them wherever it is located.
For example you can't buy a Tom Bihn bag from a retailer they only Come direct. There are Many such examples.

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#1902497 16-Nov-2017 05:44

I have no problem paying GST if I have too, but this whole "it's not fair that we have to charge it but overseas suppliers don't have too" from retailers we currently get is all just a smoke screen to keep charging prices high. If and when this comes in then I bet in 6 months we will hear from retailers again how it's not fair that this overseas supplier have greater buying power or some other reason to explain high pricing again.

If and when amazon comes and the prices for something is the same as a retailer then I would pick Amazon due to their return policy (i.e. no fighting to return stuff and waiting weeks to get it sorted) and their selection of goods (i.e. different colours of a product and not just black that we seem to only get in nz).

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#1902501 16-Nov-2017 06:40

Morally, what’s the difference between a multi-national using foreign jurisdictions to avoid income tax, and consumers purchasing overseas to avoid consumption tax?

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