Amazon Tax to Launch in New Zealand

May 1, 2018 Taxation in New Zealand

Amazon taxWELLINGTON – Small and cheap goods bought by New Zealanders online will soon be 15 percent more expensive, as the government announces the launch of an “Amazon tax”.

On May 1st the government of New Zealand announced that overseas firms selling goods to New Zealanders online will soon be liable to pay GST on all sales made to locals.

Currently, New Zealand levies a GST of 15 percent on the sale of all goods and services, whether online or in a physical store.

However, up to now, GST was simply not collected on the sale of goods with a purchase price of less than NZD 400, as the cost of compliance would be too high.

The government has now stated that any overseas firm making in excess of NZD 60 000 in sales to New Zealanders each year would be required to register for GST in New Zealand, and would be liable to pay GST on its sales.

It is presumed that the cost of the GST would be passed directly on to consumers.

The tax extension has come to be called the Amazon Tax.

The government expects that the tax will raise an extra NZD 53 million in revenues in its first year of operation, rising to NZD 87 million by 2021-22.