The New Zealand government has today proposed a change in the law that would require offshore suppliers of low-value goods to New Zealand consumers to collect and return GST on those goods.
The move follows Australia’s plan to impose GST on low-value imported goods from July 1.
The so-called “Amazon tax” would close a loophole that gives offshore companies selling to New Zealand consumers a competitive advantage over domestic retailers, the government said.
“Domestic businesses have long called for greater fairness in the treatment of low-value goods from offshore retailers,” said New Zealand Revenue and Small Business Minister Stuart Nash. “Foreign companies are not required to collect GST on goods under $400. We are now calling for feedback on a system to register these suppliers for GST.”
The New Zealand proposal requires offshore suppliers to collect GST on low-value goods at the moment of sale rather than at the border. Customs tariffs and border security and biosecurity fees will no longer be collected.
The new system would apply to offshore business with total sales to New Zealand consumers that exceed NZ$60,000 (USD 42,200) per annum. The new GST law is proposed to become operational in October 2019.
Submissions on the proposals are due June 29.
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