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

The new robotic surgery helping vaginal mesh removal
108377 2019-07-19 00:00:00Z Health

The new robotic surgery helping vaginal mesh remov…

by Ruth Nichol

Women with complications caused by deeply embedded vaginal mesh are being aided by a pioneering surgical technique.

Read more
A beautiful mind: What people with Alzheimer's can teach us
108544 2019-07-19 00:00:00Z Health

A beautiful mind: What people with Alzheimer's can…

by Fergus Riley

North Auckland farmer Fergus Riley has uncovered many important lessons in caring for his father Peter, who has Alzheimer’s.

Read more
When biodegradable plastic is not actually biodegradable
108562 2019-07-19 00:00:00Z Planet

When biodegradable plastic is not actually biodegr…

by Isabel Thomlinson

A study on biodegradable plastic bags found they were still intact after three years spent either at sea or buried underground.

Read more
Brexit-torn England needs the Cricket World Cup more than we do
108521 2019-07-18 10:26:20Z World

Brexit-torn England needs the Cricket World Cup mo…

by The Listener

Amid the agony of defeat, we must remember that the UK is in such terrible shape politically that it deserves to cherish this flickering flame of...

Read more
Trades Hall bombing case re-opened, evidence released
108515 2019-07-18 00:00:00Z Crime

Trades Hall bombing case re-opened, evidence relea…

by RNZ

Caretaker and unionist Ernie Abbott was killed almost instantly when he picked up the suitcase containing the bomb.

Read more
Where to celebrate the Apollo 11 moon landing
108504 2019-07-18 00:00:00Z What's on

Where to celebrate the Apollo 11 moon landing

by The Listener

On the big screen, the small screen, the page or the ceiling, here's where you can toast the 50th anniversary of the moon landing.

Read more
Why we need to plant more native trees than pines
108089 2019-07-18 00:00:00Z Planet

Why we need to plant more native trees than pines

by Jane Clifton

We do need more trees, but native species may be a better long-term choice than pine trees.

Read more
How to eat a New Zealand forest, and other secrets
108277 2019-07-18 00:00:00Z Planet

How to eat a New Zealand forest, and other secrets…

by Sally Blundell

Our native forests provide food and natural medicines, support jobs, hinder erosion and play a major role in climate-change mitigation.

Read more