Campaign to close GST loophole

ASOSNew Zealanders who snap up cheap books, clothes and other goods on overseas websites should be forced to pay GST on their orders to level the shopping playing field, retailers say.

NZ shopkeepers have launched a campaign on Monday lobbying the government to introduce a NZ$25 (A$24.52) threshold for collecting GST on foreign purchases, considerably lower than the current NZ$400 cut off.

Under the changes, offshore online retailers like book seller Book Depository and clothing store Asos would be required to register for GST in NZ, and charge an extra 15 per cent on every purchase over NZ$25.

Retail NZ and Booksellers NZ are behind the #efairnessnz campaign which they say will close a loophole which creates an unfair disadvantage for NZ retailers.

Retail NZ public affairs GM, Greg Harford, said NZ’s high threshold for offshore GST collection was threatening local town centres, costing jobs, and eroding the tax base.

“The government is missing out on more than NZ$200 million a year in GST and duty on low value goods alone – funding that could pay for at least 4345 new first year primary school teachers, or more than 9000 hip replacements every year,” he said.

Prime Minister John Key, said last month it was inevitable that GST would need to be paid on online purchases.

However, he warned there was no simple solution.


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