GST debate rages on: The Warehouse Group and InternetNZ add their two cents

  • News
  • October 1, 2015
  • Elly Strang
GST debate rages on: The Warehouse Group and InternetNZ add their two cents

The Warehouse Group (TWG) has made an appeal to the Prime Minister to instate the overseas online GST on purchases overseas.

Its views were included in a report produced by independent public policy think tank, The New Zealand Initiative.

The Prime Minister invited The New Zealand Initiative members to suggest government regulations they think should be changed or scrapped.

“We are all for competition in the marketplace - we accept it, we encourage it and we thrive on it,” TWG states.

However, it says the current de minimis rule creates an exemption for overseas online purchases under $400, which results in an uneven playing field for retailers.

“Currently New Zealanders are spending approximately $1.5 billion with international online retailers each year,” TWG says.

“That is the equivalent to a business twice the size of Farmers Trading Company and equates to a loss of approximately $225 million in GST each year.”

It says New Zealand’s online spending at international retail sites is growing at a faster rate than domestic online sales.

“Due to our country’s size and location, we are even more susceptible to a steeper incline in this trend due to the broader range that international online shopping provides,” it says.

In its submission piece on online GST, InternetNZ argues New Zealand’s size and location is the reason why the government should tread carefully with imposing tax.

“New Zealand is a small market, and benefits from access to overseas products,” it says.

“There is a risk that real or perceived compliance costs will stop overseas suppliers from selling into NZ. Any change in this area must be carefully crafted to avoid barriers to trade.”

It says it acknowledges that local retailers may see what is happening now with overseas online GST as unfair.

“However, it is far from clear than extending GST to low-value overseas purchases will affect the choices of consumers. People buy from overseas for a range of reasons, including variety of products and price differences much greater than the GST margin of 15 percent.”

It says it supports the goal of fair tax treatment, but has practical concerns about the way this is going to be implemented.

TWG says it’s not just retail sales the lack of GST on low-value goods is impacting on.

It says the commercial development of shopping malls in New Zealand is likely to be hindered, especially since online sales will affect small specialty retailers, which are the cornerstone of mall developments.

This would have a negative flow-on effect to the construction industry, it says.

TWG says employment is also being effected.

“The 15 percent price advantage enjoyed by international online retailers is taking growth out of the market and making domestic retailers uncompetitive,” it says.

It says this price will likely lead to a decline in New Zealand based retail businesses, as well as jobs in manufacturing and construction.

The key principles TWG thinks should guide change to the de minimis rules are:

  • Provide a level playing field to ensure true competition.
  • Avoid New Zealand taxpayers subsidising offshore retailers.
  • Provide government with the tax revenue it is entitled to.
  • Ensure New Zealanders who choose to shop with international online retailers have a positive impact on New Zealand’s social and economic development.

InternetNZ’s key points it thinks should guide change to the de minimis rules:

  • GST collection must not act as a barrier to trade, which would harm New Zealand consumers and businesses by limiting access to imported goods and services.
  • Compliance costs must be minimised. Any compliance threshold should be no lower than the $60,000 domestic GST-registration threshold.
  • InternetNZ is concerned suppliers will cut off sales to New Zealand because of expensive compliance costs. Also, if it looks difficult to sell into New Zealand, suppliers might also not be keen regardless of price.

This is a community discussion forum. Comment is free but please respect our rules:

  1. Don’t be abusive or use sweary type words
  2. Don’t break the law: libel, slander and defamatory comments are forbidden
  3. Don’t resort to name-calling, mean-spiritedness, or slagging off
  4. Don’t pretend to be someone else.

If we find you doing these things, your comments will be edited without recourse and you may be asked to go away and reconsider your actions.
We respect the right to free speech and anonymous comments. Don’t abuse the privilege.


Macpac has created an online megastore

  • Technology
  • September 13, 2019
  • The Register
Macpac has created an online megastore

New Zealand outdoor equipment retailer Macpac found its website wasn’t keeping up with its $10 million plus international expansion, so it’s invested in a new site which introduces new content, accessibility and a frictionless experience.

Read more

Pak'nSave wins August's Ad Impact Award

  • News
  • September 12, 2019
  • StopPress Team
Pak'nSave wins August's Ad Impact Award

August was an amazing month for advertising and choosing a winner of the Colmar Brunton Ad Impact Award was a difficult task. This month, the honour goes to PAK’nSAVE with their latest advertisement ‘Saveyest Country’, which uses their classic stick man to show how New Zealanders are saving, not just at PAK’nSAVE.

Read more

Spark’s new concept store at Westfield Newmarket

  • Design
  • September 12, 2019
  • Sarah Dunn
Spark’s new concept store at Westfield Newmarket

When Westfield Newmarket opened, telecommunications company Spark took the opportunity to launch a new concept store which prioritised innovative technology and an immersive retail experience.

Read more

Social scoreboard

Zavy and The Register have worked together to create a scoreboard that compares how the top 25 traditional media advertising spenders in New Zealand have performed on social media over the past 30 days, updated in real time.

Concept to closet
Business coverage of New Zealand Fashion Week.
Regional rollercoaster
What does retail look like in 2019 for ...
Town centres
A positive retail environment over the past 12 ...
Amazon Arrival
Keeping up with all things Amazon as it ...
The Retail Yearbook 2017
As we battle our way through the busiest ...
The future is bright
We spoke with four retailers in their twenties ...
Hospitality enhancing retail
Some think food and integrated hospitality offerings will ...
Spotlight on signage
At first glance, the humble in-store sign might ...
Red Awards 2016
The Red Awards for retail interior design celebrate ...
Auckland Unitary Plan
Auckland is changing. The Unitary Plan will decide ...
How to open a store
Sarah Dunn considers what it would take to ...
All things to all people
Kiwi retailers share their omnichannel strategies.
Rising stars
Retail's top young achievers.
Delivering on your promises
The sale isn't over until your item is ...
Retail in heartland New Zealand
Retailers keep the regions pumping, but how strong ...
Women in retail help one another. We spoke ...
The changing face of retail
Shifting demographics are creating big changes in New ...
The retail yearbook
With the help of experts in the retail ...
Retail rogues
We put the spotlight on staff training. Jai ...
Here come the giants
Topshop has arrived in Auckland’s CBD, David Jones ...
From retail to e-tail
Ecommerce has become part of the way mainstream ...
Loyalty in the digital age
How are retailers maintaining loyalty? Sarah Dunn, Elly ...
Window shopping: A spotlight on social media
Sarah Dunn and Elly Strang look at how ...
The Innovators | In partnership with Spark Business
Technology is rapidly changing the retail industry as ...

Trust the process: Is there still a place for liquor licensing trusts?

Liquor licensing trusts are a unique corner of the retail market, but is the model still relevant in our fast-changing business environment? Sarah Dunn weighs ...

Sponsored content

Recruitment with a fresh frame of mind

Frame Retail is the recruitment agency with an eye for fashion retail.


Kathmandu becomes Australia and New Zealand’s largest B Corp business

  • News
  • September 11, 2019
  • The Register
Kathmandu becomes Australia and New Zealand’s largest B Corp business

Listed outdoor goods retailer Kathmandu has secured B Corp accreditation, making it the largest business of its kind to have done so in Australia and New Zealand.

Read more
Next page
Results for
About us.

The Register provides essential industry news and intelligence, updated daily. And the digital newsletter delivers the latest news to your inbox twice a week — for free!

©2009–2015 Tangible Media. All rights reserved.
Use of this site constitutes acceptance of our Privacy policy.

The Register

Content marketing/advertising? Email or call 022 639 3004

View Media Kit