Revenue Minister Stuart Nash says GST will go on online goods, then backs down

by Checkpoint / 16 November, 2017

Revenue Minister Stuart Nash Photo: VNP / Phil Smith

The government has backed off suggestions that GST on online shopping was inevitable, saying it will be discussed as part of its tax working group.

Local retailers have been pushing for the GST charge for some time, saying it would level the playing field.

Earlier yesterday, Revenue Minister Stuart Nash said the government would "absolutely" introduce a GST charge on goods bought online from overseas companies.

Mr Nash later failed to appear at a planned media briefing and would not answer questions from RNZ about the proposed charge.

Finance Minister Grant Robertson did front up to media and said that when Mr Nash said it was happening, "he means that we're working on it and he did say that we don't have the full process or timeline for that".

In a statement released late yesterday afternoon, Mr Nash said the government's tax working group will be looking at GST on online goods and services.

"Work is already underway on this issue and it will be incorporated into the working group's considerations, who will be given the ability to make an early recommendation on this matter as appropriate."

New Zealand retailers have argued that their customers have been punished for buying locally.

Unity Books co-owner Tilly Lloyd said her customers in this country were essentially paying a surcharge of sorts and the sooner a GST was introduced, the better.

"It's really good news for our street and online onshore customers, they won't be subsidising Amazon customers anymore. All it required really was will and courage and now Nash has taken that, that's good, and the methodology for applying it, they'll work it out."

While consumers could expect prices to rise by 15 percent, PwC managing partner and tax expert Geof Nightingale says that could be offset because it could help avoid further rises in income tax.

Retail NZ has estimated that the government would be missing out on $5.8 billion in lost GST revenue over the next 10 years.

Mr Nightingale said it was likely New Zealand would follow what Australia was implementing in July next year.

"What they've done in Australia is go to the foreign supplier collection model, asking the supplier - think Amazon - to register for GST in Australia and they'd take responsibility for collecting the GST and not involve customs."

The previous National government already brought in the so-called Netflix tax, which means online services, like video and music streaming and downloads, are subject to GST.

Customs had also been tasked with looking at how to collect GST on low-value imported goods,

 

This article was originally published by RNZ.

Latest

Why ethical eating often stops at the restaurant door
101520 2019-01-22 00:00:00Z Food

Why ethical eating often stops at the restaurant d…

by Rachel A. Ankeny and Heather Bray

Can a chef promote foraging, seasonality and plant-based eating, yet also serve meat and other animal-derived protein products on the same menu?

Read more
Why the Dunedin Museum of Natural Mystery is bound to attract the curious
101463 2019-01-22 00:00:00Z Life in NZ

Why the Dunedin Museum of Natural Mystery is bound…

by Ellen Rykers

Artist Bruce Mahalski's museum is the result of a lifetime of collecting.

Read more
Gillette ad isn't anti-men, it's anti-toxic masculinity – it should be welcomed
101480 2019-01-21 16:59:29Z Social issues

Gillette ad isn't anti-men, it's anti-toxic mascul…

by Nicola Bishop

The backlash against the Gillette ad shows how painfully little distance we as a society have covered since the #MeToo movement.

Read more
Cost of Auckland public transport to go up
101459 2019-01-21 14:08:56Z Auckland Issues

Cost of Auckland public transport to go up

by RNZ

Auckland's public transport users will soon see fares increase by up to 50 cents.

Read more
The future of gangs in New Zealand
101322 2019-01-21 00:00:00Z Social issues

The future of gangs in New Zealand

by Philippa Tolley

Best of RNZ: Gangs have been a feature of New Zealand society for more than half a century. Philippa Tolley takes a look at what future lies ahead.

Read more
How some Germans are countering the extremist views of the far-right
101320 2019-01-21 00:00:00Z World

How some Germans are countering the extremist view…

by Cathrin Schaer

Germans face a familiar dilemma in finding ways to oppose the views of the far-right Alternative for Germany party.

Read more
White Noise: Who is shaping Auckland's future?
101439 2019-01-21 00:00:00Z Auckland Issues

White Noise: Who is shaping Auckland's future?

by Kate Newton

Some Aucklanders have more say in their city's future than others.

Read more
Stephen Fry revisits the world of the Ancient Greeks in Heroes
101242 2019-01-21 00:00:00Z Books

Stephen Fry revisits the world of the Ancient Gree…

by Lauren Buckeridge

In his delightful way, Stephen Fry dips back into the ancient world with more stories of tests, quests and feats of old.

Read more