Sorry Jacinda, but you’ve broken another promise

Jacinda Ardern thinks that whacking Kiwis with GST on online purchases isn’t a new tax.

She’s wrong.

I haven’t had to pay it before on online offshore purchases, and now I will have to pay it. That is a new tax. She is dancing on the head of a pin: Quote:

Applying GST to online purchases under $400 from overseas is not a new tax, Prime Minister Jacinda Ardern says.

Speaking to Newstalk ZB’s Mike Hosking this morning, the Prime Minister said GST had always been applied to those purchases, but never collected.

“How is GST a new tax? These purchases have always been eligible for GST, they’ve always had it applicable, it just hasn’t been collected. No one would argue GST is a new tax. I really refute that. GST has been around for a number of years. We’re just making sure we’re improving the collection on certain goods that have been exempt because of collection issues,” she said.

Revenue Minister Stuart Nash and Customs Minister Meka Whaitiri are set to make an announcement on measures to collect the 15 per cent GST on low-value goods bought by Kiwis online from overseas, the so-called “Amazon tax”, at a bookshop in Wellington.

GST is payable on all goods bought in New Zealand, including overseas online purchases such as books bought on Amazon or Book Depository or goods from Alibaba and eBay.

But the cost of collecting it on small things such as a $40 book, means it is not collected.

The Government’s announcement is likely to find a way to make large sellers comply with New Zealand law by registering and collecting GST.

The tax will be on anything under $400. Anything above $400 already attracts duties.

It follows on from the “Netflix tax” which started in October 2016 and which required foreign providers to levy GST on digital services sold to New Zealanders including Netflix, Spotify, iTunes, Kindle, online games and software.

In November, Nash promised further action, saying that leaving out low-value physical goods gave an unfair advantage to overseas sellers compared with New Zealand sellers.

Before the last election, Labour promised not to implement tax changes this term arising from the tax working group. End Quote.

So, they’ve whacked us with a new fuel tax, which Jacinda calls an excise, conveniently leaving out the word tax as she pirouettes on that head of a pin. Now they’ve done the same thing with GST.

Worse still they make out they are helping out retailers and that this will assist them. That is a dishonest explanation. People do not make purchasing decisions online because they think they are saving the GST. For example, I buy a lot of gear online and my decision is based on availability first and foremost, and cost secondly. Mostly it is availability. Many items cannot be bought here…and if you can get them they cost an arm and a leg for no good reason other than distributors and retailers are ganking customers.

Add on the GST by all means, I’ll still be buying online because retailers simply don’t stock what I want. If you don’t believe me then go look up the price of Lowa boots at Hunting & Fishing, then look on Amazon. The saving is way more than the GST. Same with rifle scopes. Check a named brand, like Leupold or Zeiss or Swarovski in NZ, then look at B&H in New York. Another example is 5.11 clothing which can only be bought at one store in Albany. Not all lines are available in NZ. I can get what I want online from Amazon and shipped to my door. Even if it was more expensive I’d buy it online because I can’t stand shops and stores, or most of the people who work there and mostly they simply don’t have what I want. Adding GST won’t change that.

The government should just be honest, that they want to collect more revenue. It certainly isn’t about helping retailers. If retailers need this to survive then they don’t deserve to be in business.