This means Kiwi retailers can’t compete with foreign websites and their pricing, says Retail NZ general manager of public affairs, Greg Harford.
“[It] effectively creates a reverse tariff that is harming Kiwi businesses, costing Kiwi jobs and depriving New Zealanders of choice in their shopping centres,” Harford says.
“Price is a key driver for shoppers, and the reverse tariff is encouraging people to send their money offshore, rather than support New Zealand’s great retailers.”
He says New Zealand’s low-value threshold of $400 is high compared to the likes of Canada and the UK, which collect tax on goods worth more than CAD $20 and GBP £15.
“Retailers in those countries don’t face the same competitive disadvantage faced by New Zealand retailers,” he says.
“Retail NZ and others have been raising this issue with government for some time, and we are pleased that Minister McClay has asked his officials for some advice on how other countries handle the issue.”
He says the current reverse tariff in place will eventually hurt New Zealand consumers if it’s not changed.