GST to be charged on purchases below $400

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timmmay

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Topic # 233744 1-May-2018 07:32

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Quoted from NZHerald article:

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"The Government is set to announce further measures today to collect 15 per cent GST on low-value goods bought by Kiwis online from overseas, a so-called "Amazon tax."

The tax will be on anything under $400. Anything above $400 already attracts duties.

It follows on from the "Netflix tax" which started in October 2016 and which required foreign providers to levy GST on digital services sold to New Zealanders including Netflix, Spotify, iTunes, Kindle, online games and software."

While the tax will be paid by the foreign firms selling the goods the cost would inevitably be passed on to the buyer in the form of increased prices.

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Stuff says "That would see import duty and biosecurity fees on low value goods axed, softening the blow for consumers.".

It looks like the providers will collect the tax, so hopefully shipments aren't delayed by a slow customs service. While annoying, online purchases will still often be miles cheaper than local purchases, so it's really just a revenue gathering exercise.

I wonder what the real rate of tax is in NZ, when you take into account ACC levys, petrol tax, GST, etc.

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Reply # 2005587 1-May-2018 07:34

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I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

Seems that only retails in partnership with customs or what ever will be charging this and I saw it quoted that the likes of a $40 book they won't bother because its costs more to collect on it than they make.

Revenue gathering through and throughout.

heavenlywild

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Reply # 2005588 1-May-2018 07:34

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Someone will say it eventually so I might as well get it done. Another week another tax. #letstaxthis

timmmay

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Reply # 2005590 1-May-2018 07:46

Coil:

I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

I heard on the radio labor are saying something like "National planned this so it's not counted as a tax labor introduced", or something along those lines.

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sbiddle

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Reply # 2005591 1-May-2018 07:53

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How is it fair that IETF and processing fees are slashed on goods under $400 but that you'll have to pay over $400?

Coil

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Reply # 2005594 1-May-2018 08:01

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timmmay:

Coil:

I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

I heard on the radio labor are saying something like "National planned this so it's not counted as a tax labor introduced", or something along those lines.

My friend planned the murder and I pulled the trigger really get you out of jail for free too.

scuwp

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Reply # 2005596 1-May-2018 08:02

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timmmay:

Coil:

I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

I heard on the radio labor are saying something like "National planned this so it's not counted as a tax labor introduced", or something along those lines.

"It's not a new tax...it's an extension of an existing tax to cover a wider range of the market and therefore introduce fairness that was lacking under the previous government"

or something like that...I should have been a politician :-)

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Fred99

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Reply # 2005604 1-May-2018 08:18

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sbiddle:

How is it fair that IETF and processing fees are slashed on goods under $400 but that you'll have to pay over $400?

I didn't think that IETF was payable in that case (under $400 in most cases) anyway.

As far as the biosecurity levy goes, I suspect that there's a much greater risk from a pack of dried wild meat jerky being sent from Auntie, or a few seeds for the garden thrown in with a card and a birthday gift, than in some electronic gadget bought on Aliexpress, thus that levy was always unfair as it wasn't being collected from where the risk was. It was ideological "user pays"

The GST threshold was set at a level below which it was determined that cost of collection exceeded the return, so I don't go along with claims these changes are "revenue gathering" if the fact is they're actually "revenue losing".

This all said, I don't care much (I hope - unless there are some surprises). That you pay GST on everything was always the idea behind GST.

surfisup1000

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Reply # 2005605 1-May-2018 08:21

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Coil:

I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

Seems that only retails in partnership with customs or what ever will be charging this and I saw it quoted that the likes of a $40 book they won't bother because its costs more to collect on it than they make.

Revenue gathering through and throughout.

GST is not a new tax though. They are just starting to collect it where before it was too difficult. As long as they are not adding all those import duties etc, i don't see much of an issue.

surfisup1000

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Reply # 2005610 1-May-2018 08:24

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sbiddle:

How is it fair that IETF and processing fees are slashed on goods under $400 but that you'll have to pay over $400?

Yes, and the government should cut import fees so that retailers get their 'equal' playing field.

Retailers don't want an equal playing field though, they want exclusive right to sell to kiwis if they can. And rip us off.

The sooner local bricks and mortar disappear the better.

old3eyes

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Reply # 2005614 1-May-2018 08:30

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surfisup1000:

Coil:

I thought that Labour was not adding any further taxes along with a whole raft of other broken election promises lol.

Seems that only retails in partnership with customs or what ever will be charging this and I saw it quoted that the likes of a $40 book they won't bother because its costs more to collect on it than they make.

Revenue gathering through and throughout.

GST is not a new tax though. They are just starting to collect it where before it was too difficult. As long as they are not adding all those import duties etc, i don't see much of an issue.

GST is not a new tax but adding to to items under $400 is a new tax..

Regards,

Old3eyes

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Reply # 2005627 1-May-2018 08:45

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This and petrol excise are really going to get peoples ire up. Glad I've got some popcorn.

I've also got an opinion :)

Yes this is not a new tax - it is just an existing tax being applied in an extended manner. But it does break the spirit of the Labour promise.

But it is also fair. Retailers can import small shipments of under $400 if they wish. Everyone who imports pays GST.

In the scheme of things this won't effect the average person very much - I doubt most people spend more than $500 a year on overseas imports.
But it will feel like they are losing more so the complaints will be loud.

Saying that what are they going to do for those returning from holiday. Will GST now be charged on duty free Beer and Cigarettes?

SirHumphreyAppleby

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Reply # 2005628 1-May-2018 08:48

timmmay:

It looks like the providers will collect the tax, so hopefully shipments aren't delayed by a slow customs service. While annoying, online purchases will still often be miles cheaper than local purchases, so it's really just a revenue gathering exercise.

Someone is going to have to check supplier details to ensure they're not exceeding the annual $60k limit. That means in theory, details of each and every package going through the mail system need to be entered and checked against a list of suppliers.

I'm waiting on more detail before I speculate too much, but I can see customs labour costs going through the roof, and people being extorted for GST and fees because they were sent a generic envelope with $HK8 printed on it, containing a $0.50 cable, from a supplier (or freight forwarder) who has sent a few too many such packages in the previous 12 months. Meanwhile, those of us importing items over $400, will likely have to foot the bill for it.

MikeB4

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Reply # 2005631 1-May-2018 08:56

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surfisup1000:
sbiddle:

How is it fair that IETF and processing fees are slashed on goods under $400 but that you'll have to pay over $400?

Yes, and the government should cut import fees so that retailers get their 'equal' playing field.

Retailers don't want an equal playing field though, they want exclusive right to sell to kiwis if they can. And rip us off.

The sooner local bricks and mortar disappear the better.

If the bricks and morter stores were to go the resulting unemployment would crippple our economy and be socially devastating.There is in excess of 260,000 people directly employed in retail and probably that again in related and dependent businesses.

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surfisup1000

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Reply # 2005634 1-May-2018 09:03

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old3eyes:

GST is not a new tax but adding to to items under $400 is a new tax..

Yep, I see that argument and how it might feel like a new tax.

GST was always supposed to be paid on those sub $400 items. They just haven't been collecting it. So it is not technically a new tax or an increase in existing taxes.

But I agree most people will perceive this as a new tax. And perceptions count at elections!

surfisup1000

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Reply # 2005637 1-May-2018 09:09

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MikeB4:

If the bricks and morter stores were to go the resulting unemployment would crippple our economy and be socially devastating.There is in excess of 260,000 people directly employed in retail and probably that again in related and dependent businesses.

Sooner the better . These people can retrain and move into jobs that have way higher productivity than peddling shoes and cheap tv's.

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