New laws in Australia that force Amazon to the good and services tax on transactions has prompted the e-retailer to not allow its Australian consumers to its global sites.
Australian consumers shopping on Amazon international sites will be redirected to the local Australian site from July 1 when the new GST regulations begin.
There would a significant reduction in the options available for consumers when browsing, said consumer campaigner Christopher Zinn.
The move was regrettable, Amazon said in a statement, also acknowledging the inconvenience that would be cause to consumers who are used to visiting the global site of Amazon.
“We have had to assess the workability of the legislation as a global business with multiple international sites,” an Amazon spokeswoman said.
At present, overseas purchase of more than $1000 attracts GST.
Starting July 1, online retailers like Amazon would be mandated to impose the 10 per cent GST for goods bought overseas and shipped to Australia.
This change in law was forced upon by years of campaigning by local Australian retailers like Harvey Norman, Myer, JB Hi-Fi and David Jones, whose brick and mortar stores have suffered due to the growth of online retailers.
It is believed that Amazon views it responsibility of tracking Australian GST from all overseas transactions as a huge administrative burden.
The process of the collecting the GST was questioned by Zinn even though he acknowledged the logic behind the Government is changing the rules.
“I think it’s fair enough that Australian consumers pay GST on items they might buy, but asking international corporations to collect that for you is quite another matter,” he said.
The Federal Opposition, which supported changing the GST rules, also echoed the same sentiments.
“In principle we support the GST applying from the level of zero … when the government went down this road I raised concerns about implementation details, I was getting very strong feedback from providers that the Government’s model would not work,” said Shadow Treasurer Chris Bowen.
In the future the government might tweak the system. believes Australian Retailers Association Chief Executive Russell Zimmerman.
“Our view is that it’s better to put something in albeit that it won’t work as efficiently as it should and at least start the collection,” Zimmerman said.
“Our understanding is that it is a three-year period and then they will be doing a review and I’m sure if it’s not working successfully the Government will probably look in a shorter period of time than three years.”
While Amazon has taken the extreme step to counter the GST changes, major changes to its global systems is being made by eBay so that Australian consumers may still purchase from suppliers anywhere in the world.
“We won’t block Aussie buyers, redirect them or require them to pretend they are located overseas. Australians will continue to be able to buy from any eBay site,” a spokeswoman for the company said.
(Adapted from ABC.net.au)