Amazon to Block Its US Website for Aussie Shoppers over New GST Rules, and GST to Apply on Imported Goods Starting July

Related Stores

Amazon US
Amazon US

Comments

  • Article is behind a paywall..

    Amazon to block its US website for Aussie shoppers over new GST rules
    By Patrick Hatch
    Updated 31 May 2018 — 12:01pm first published at 11:57am

    Australians will be blocked from shopping on Amazon's international websites and restricted to using its smaller local platform so the e-commerce giant complies with new GST rules on online purchases.

    Amazon said on Thursday that Amazon.com, its American website, and other overseas sites would no longer ship to Australian addresses from July 1. Shoppers visiting those sites will be redirected to Amazon.com.au, which launched late last year.

    uly 1 is the date new rules come into effect forcing online retailers to apply the 10 per cent GST to all online purchases being shipped to Australia from overseas.

    GST currently applies only to items bought from overseas retailers worth more than $1000. This so-called "Amazon tax" was brought in after heavy lobbying by local retailers - which have to apply GST to all sales, whether online or in store - to "even the playing field" with international online rivals.

    "While we regret any inconvenience this may cause customers, we have had to assess the workability of the legislation as a global business with multiple international sites," an Amazon spokeswoman said.

    Fellow online trader eBay also threatened to block foreign sellers if the tax changes went ahead. Fairfax Media has asked the marketplace platform if it intends to follow Amazon's lead.

    Australian shoppers will still be able to access 60 million products available on Amazon.com.au, including many from international third-party sellers.

    The company will also be launching a "global store", opening up access to another 4 million items previously available only on its American website.

    However, the number of products available to Australians will be only a fraction of the estimated 500 million available on Amazon.com.

    Amazon's decision to not even ship products to Australia regardless of where they are purchased will scupper any plans tech-savvy shoppers might have to use geo-blocking software to get around the ban.

    In a submission to a Productivity Commission inquiry into GST changes last year, Amazon said delivery companies like Australia Post, DHL and FedEx should be responsible for collecting the tax instead of vendors such as itself and eBay.

    A model in which vendors collected GST was "fundamentally flawed" because it required voluntary compliance from thousands of offshore online retailers, Amazon argued, and consumers would simply seek out vendors that did not comply.

    Putting the burden on a small number of logistics companies, which operated in the Australian Tax Office's jurisdiction, would ensure greater consistency and compliance.

    Treasurer Scott Morrison's office has been contacted for comment.

    More to come

    • Fellow online trader eBay also threatened to block foreign sellers if the tax changes went ahead. Fairfax Media has asked the marketplace platform if it intends to follow Amazon's lead.

      I wonder if eBay will also block all those Chinese sellers of cheap stuff. That's going to generate even more anger against the rules. The ones who will benefit are the big companies like Gearbest, Zapals, etc. who have their own websites and will just scoff at the law.

      • The outcome of this Government's Catch 22 policy will be to shut down retail competition (Amazon is a yes, Ebay very likely based on previous media releases, and the others yet to say what they will do). If these retailers shut their doors on Oz = no GST collection and the Government has a result as good as shooting both feet with one bullet! The Government's not insane, just sanely stupid…

        To put this into another context the Government has just shut down the equivalent of a dozen Westfield's, each and all with unique offerings that voters wanted, all goods unavailable in Oz.

        I am happy buy from the much better choice that overseas retailers provide. I am happy to pay GST on my choices. If I see that most companies just won't ship, I'll travel OS with an empty suitcase - back to the bad old days.

        Gerry and Sollie will never ever get my business. Kents!

        What a great set of BBQ and Pub conversations this will kick off!

        Keen to see an OzBargain Blog on how to get around this shit!

        • My favourite Catch 22 quote applies quite appropriately to Morrison:

          “Some men are born mediocre, some men achieve mediocrity, and some men have mediocrity thrust upon them. With Major Major it had been all three. Even among men lacking all distinction he inevitably stood out as a man lacking more distinction than all the rest, and people who met him were always impressed by how unimpressive he was.”
          ― Joseph Heller, Catch-22

        • Just use shipito.

        • It's incredibly annoying for me as a consumer, but I'm struggling to see how this is a Catch 22 for the government?

          The majority of people won't fly overseas to buy these items, they will seek foreign websites not complying with the rules (so no change to GST revenue), seek foreign websites that comply with the GST rules (more GST revenue) or use a local supplier (more GST revenue). The small number of people who will fly overseas will result in more tax revenue as you'll be paying air taxes, and the non-payment of GST is exactly the same as it is now anyway.

          The absolute worst case scenario is therefore no increase in tax revenue.

          As to getting around it, you can use one of the shipping companies that forward these deliveries from the US etc. on to Australia.

        • @callum9999: You assume much:
          * That consumers still can easily get their unique goods elsewhere, not from Amazon or eBay, at the same prices on these sites (probably not everything, mostly not at the same prices)
          * That other sellers also won't cease shipping to Oz too (We are a tiny market after all)
          * That shipping companies will add capability for GST (They can also choose not to)
          * That consumers are willing to pay inflated local prices for goods they bought cheaply from OS (However budgets are fixed, not elastic so don't go as far when paying GST AND handling charges)
          * And finally that consumers are willing to 100% substitute the unique items they want (Highly unlikely when these are unique and not available in Oz)

          Bottom line is if you can't get it, can't substitute it, your budget won't stretch for the Oz price of it, then you don't buy it and no GST is paid. So the government misses on GST revenue.

          That is what I call Catch 22. You don't buy and the government collects no tax.

        • @twinbag: Shipito isn't a bargainer's solution.

        • @Musing Outloud:
          It's not a catch 22.
          They're getting nothing now. They get nothing of no one bus because of the increased costs.
          If people need it, they will eventually buy.
          If they don't, they will increase savings.

          Do you understand what a catch 22 is?

        • @LlamaOfDoom:

          Absolutely spot on. I buy a lot of stuff overseas so have benefitted from the under $1000 rule, but I'm not one of those hypocrites who wave the Aussie flag one minute and then argue for a national debt the next. I support the principle that we support Aussie traders above foreign online sites and am sort of pleased that I won't have the choice to avoid Aussie taxation from July 1.

          If we support this country it sometimes means we have to pay a bit more. We don't have the economy of scale that US or EU wholesalers have and Gearbest won't deliver you a Denon 7.1 receiver. There's a lot of muddled points being made here, but they all boil down to the wants of three people "me, myself and I".

      • So for the sake of a few cents on the dollar we lose access to thousands of products. Well done, scum government. And as for you, Harvey Norman - congrats - you've GUARANTEED I will never purchase from your store again, no matter how much cheaper you are (and you never are).

        Amazon should have just said it's your country so YOU collect it and shipped packages without Amazon labels.

      • Lately I've noticed a stupid amount of 'Aussie' sellers who are actually falsely reporting their item location as being in Australia, and they send it from a Chinese warehouse.

        Google tells me this has been a problem for a while. And eBay clearly do not care at all. They get their money either way.

        I doubt they'll lift a finger for the import tax.

        • And eBay clearly do not care at all. They get their money either way.

          This certainly does seem to be the case. I always check on negative feedback, and some sellers claiming to be in Australia, have most of their negative feedback due to lying about location. Obviously ebay knows about it.

        • I agree, usually says item location is in Darwin…

        • This is a OLD issue.
          Been around for a very long time.
          In the end if the item does arrive within a few days - who cares?

        • Sometimes they have bulky items in a warehouse in Australia and the rest are in China, so it's a half-lie. I recently bought a HuaKo soldering iron for $11 shipped. It came within a couple of days by eParcel so it was sent locally. The item was heavily discounted and they were losing money on the shipping, so obviously clearing out stock.

        • @Amayzingone: The issue is that sellers that don't lie about their location are usually cheaper. The whole point of buying from an Australian seller is to get the item within a week or so. I've had packages take longer than a month to arrive from China. The difference isn't 'a few days'. It's usually 2 weeks.

        • Even Kogan does it - ship direct from a Chinese warehouse taking 2 weeks to get here - for some items

      • From the Age article:

        ==============

        Fellow online trader eBay had threatened to block foreign sellers from its marketplace if the tax changes went ahead, but on Thursday said it was working on a way to collect GST on overseas sales without restricting any sellers.

        "This requires major changes to eBay’s global systems and we are working to have these ready by 1st July," an eBay spokeswoman said.

        "eBay’s GST solution will allow us to collect GST in any currency, from any seller, from any eBay site."

        ==============

        So it looks like we'll be paying GST on all overseas ebay purchases :(

    • If you are really worried about this, and are willing to expend as much effort as whinging on a forum contact your MP and tell them what you think.

      Here's how, just enter your postcode and send them the message:
      https://www.aph.gov.au/Senators_and_Members/Guidelines_for_C...
      or use this form:
      https://www.getup.org.au/campaigns/save-our-forests/forestry...

      I know this is not a popular way, and might be down voted, but Australia is still a democracy, and MPs and senators need your votes. Tell them to put back the $1000 limit on GST, or tell them you support the measure, or whatever, but let them know what you think, not just what lobbyists or Gerry Harvey tell them.

      • Sent.

      • Template a message for the ultra-lazy? I'll send one for sure.

        • OzBargain bans me for using bad language, so can't help you.

        • @The Gent: Well that never <profanely> well stopped me lol

        • @idonotknowwhy:

          Language please. We have children and people who behave like children on this site.

        • @schwinn:

          people who behave like children on this site

          Yeah, you're taking to of these people right now ;)

        • Slightly tweaked the below message from the keep Shopping Open website.

          Dear MP/Senator,

          Keep Shopping Open for all Australians.

          I am concerned about the Government’s plans to introduce GST on all overseas online purchases from 1 July 2018.

          The Government’s model of forcing overseas online vendors and marketplaces to collect GST on low value imported goods will be bad for Australian consumers in many ways.

          • We’ll pay even more, because overseas vendors will raise their prices to cover the cost of the GST, plus all the extra administration costs.

          • We’ll have less choice, because many overseas online vendors and marketplaces will put selling to Australia in the too hard basket. Less choice and less competition will lead to higher prices – an issue that will hit regional Australians even harder.

          • We could have less protection, as this decision may push Australians to start shopping directly with smaller or lesser known overseas vendors and miss out on the consumer guarantees offered by trusted online marketplaces. That means less GST for Australia, and less protection from shonky sellers.

          • We could pay more for nothing since the administration and enforcement costs, plus the estimated low compliance rate, mean it could cost the Government more revenue than it raises.

          Australians have so much to lose from this proposed GST legislation and collection model.

          Please recommend against it, so we can keep shopping open, competitive
          and affordable for Australians.

      • Whilst i'm sure i'll get a generic 'thanks for your message' reply, I too have bothered to spend 10 minutes sending an email.

        Can't believe BS like this gets made into legislation. Most my purchases like others here, are items that are simply not available from AU, so absolutely no one wins here!

        • Most developed countries charges GST/VAT on imported goods through the mail system etc. You better believe it as Australia is one of the last nations to do this.

      • Good post. I'll whine here and to the MP.

      • A democracy run by China my friend!

      • @mod , can we please pin this post or put it in the first post please?

      • Message sent.

    • This is just simply bad economics. If local retailers can’t compete with the international market, then either they need to differentiate their product or find a way to lower costs. The answer is almost never a tax, this literally only lowers the quality of life for Australian consumers.

      • This was my line of thought, though I'm no economist. I don't believe this will suddenly make local retailers competitive, because the difference is often way more than the 10 percent tax.

        • Yeah, I’m only an undergrad economics student but like this is really basic stuff. Even on a moral level, the government has no right to tell consumers what they can and can’t purchase so long as there are no externalities (I.e. drugs, weapons, etc.). Imposing a tax is both counterproductive and intrusive. I’m very libertarian on these sorts of things.

      • Know what else will lower the quality of life for Australians? Being paid $12 an hour.

  • As the article points out - shoppers will move their purchases to international retailers that don’t comply with the law. Alternatively more people will use forwarders in the US to ship the goods here.

    • Unless they stop shipping to freight forwarders?

      Amazon - No Longer Shipping All Products to Freight Forwarders !
      https://www.ozbargain.com.au/node/280260

      • eBay.com and Amazon.com generally doesn't allow shopping to forwarding company but they don't put the actual limitation thus you can still ship to any USA address.

        • We use a USA forwarding company and we have never had an issue getting either Amazon.com, or EBay.com sending to that address?

        • @Ocker: Who do you use?

        • Problem is, I've never seen a freight-forwarder that didn't add so much $$$, that it made it far cheaper to just buy it elsewhere anyway.

          e.g. If the only place I can find something is from an ebay seller who doesn't ship overseas… I ask them if they will. Seven out of ten times they will. Most have emailed back that the only reason they don't, is they didn't think anyone outside the USA would want to buy xyz, or, they knew some countries are regular scammers - but… "I have no problem sending to Australia - oh, and g'day mate!"

        • @GregMonarch:

          Shipito.com

          Hope there still good as I have used them a few years back and they were the best and cheapest.

        • @Spizz: ustooz.com is the one I use for those items that don't ship to oz. Always been easy to deal with low fees and will even buy the goods for you if an oz card is not accepted.

      • From 1 July 2018, each time you check out a ShopMate parcel and declare the value of the goods, you will be asked to provide payment for your ShopMate shipping and the applicable GST all in the same transaction.

    • I think a bigger problem will be the International retailers who DO collect the GST, but don't actually pass it on to Australia. Not sure how the govmint will police that and the customers end up paying 10% extra.

      • This will be interesting.

        How does VAT work though? I assumed it was the same problem but I really have no idea.

        • How does VAT work though?

          Basically the same way as GST on items on $1000 works here; Customs determine how much is owed and send you the bill.

          In the UK for most stuff you pay the postie, they rock up to your door with a credit card reader. Under $30 or so doesn't have VAT.

    • freight forwarders add more cost to the package..
      which negates some of the savings.

      also amazon will block this.

    • Wrong on both accounts.
      People will just seek out the lowest price/amount they need to pay

    • If you use a freight forwarder, warranty might be difficult.

      Will they ship the replacement to your AU address or your forwarder? Will they accept your return from your AU address?

  • The good news out of this is, as I read the article, it looks like Amazon US items that can ship to AUS will be available on Amazon.com.au

    That means Amazon AU sellers will have to compete with Amazon US sellers. That's really all we wanted in the first place.

    • Amazon AU prices is still a rip off compared to Amazon US prices…
      and those items are sold by Amazon.

      I have checked a many items and the US price still ends up cheaper than the AU price
      as sold by Amazon.

      Not to mention there are many items on Amazon US that will not be available on AU store.

      Currently Amazon AU is a turd!
      Now they want to force us to use that turd.

      • Whilst I agree generally it's a tad overpriced, it's not surprising given the US branch is able to exploit it's factory workers to such an extent whereas here it's far less able to with higher wages and entitlements.
        So whilst I'd like a fair value I'm not going to demand dirt cheap at the cost of factory workers living wage and humans benefits.

        • Most items sold in amazon USA are made in China , and most items available in oz is also made in China . The only didference are : more lazy tax from government here, higher postage by auspost , and higher greed by the oz seller .

    • Also from what I read,
      as much as 90% of the items on Amazon US will not be available on Amazon AU.

      And if there was any items available,
      the prices are not special..
      you can probably find a similar or cheaper price by checking ebay (or even cheaper with ebay code) or local store

      The fact is Amazon AU has been a turd sandwich from day 1
      and the only reason people bought something from them just recently is
      because they had the amazon promo code "AMAZON20".

      With this banned on buying from Amazon US + international Amazon stores
      they are forcing us to eat their Turd Sandwich.

      Yuck, no thanks.

      Now Gerry Harvey and The Turdball Government has total F%#$ Up our ability to buy many more items and at a much cheaper price.

      • Have to agree. I'm a fairly regular online purchaser (I am on OzB afterall) and I have never, not once, bought something from Amazon AU. Everything on there is available somewhere else for significantly less.

      • The change will limit Australian shoppers to a catalogue of 60 million products, compared with nearly half-a-billion on its US site, potentially driving up prices due to the limited selection of items.

        • Amazon don't currently ship everything here as it is, so it isn't like we have gone from a choice of half a billion to 60 million.

          I'm just not sure what amount we can access currently.

          I just hope the 60 million does cover UHDs and blu rays and books and other items I get regularly.

      • It's getting better:
        - prices are getting cheaper (https://www.lifehacker.com.au/2018/05/amazon-australia-has-b...)
        - 60 million products and counting
        - they are growing (opening a new fulfilment centre in Sydney) which means, over time, more products, and lower prices

      • "The fact is Amazon AU has been a turd sandwich from day 1"

        Without the bread!

        • lol. Yeah, it was a bit weak at first. It does usually take a while before a new Amazon builds up. The place I work for sells on a few of them (and usually takes a while for all the sellers to notice and get on board, so the first in, tend to do well). But more and more keep starting to catch on to Australia finally, and it keeps getting bigger every time I look at it. The place I work for has already put nearly all of their products on Australia now aswell. (though we had a bit of a head-start, because we're based here).

          However, while on one hand this new law about the restriction of the USA version of Amazon kinda sucks, this is actually really helping the Australian version all the more. (Don't care so much about how much money amazon is making, but for me personally as a customer, I like that the new Australian one saves all our taxes from going overseas if we keep the money in house, if you know what I mean!) Makes deliveries not take so long aswell (with none of the customs hassles for bigger items). Already bought a few things for my Nintendo Switch on there, and they've been pretty good so far! It's way faster!

        • A turd amazon AU, and a King of Tax Turd By GOV AU .

    • Pricing will certainly be higher in AU

    • it looks like Amazon US items that can ship to AUS will be available on Amazon.com.au

      Where did you read that? Wouldn't be too bad, if that is actually the case.

    • That's not all I want. The US store has hundreds of millions of products. The AU site has a much smaller percentage of items available to them. I want variety of products and sellers, as that invites competition and lower prices. If the item is sold by one specific seller on the US site and also on the AU site, they control the price, and have no desire or need to compete for customers meaning a bigger profit margin for them, and a bigger hole in our pockets.

    • Amazon were looking for an excuse to force Australians to use the local (rip off) Amazon site and they got one.

  • Argh. There goes my plan to buy cheaper computer parts and HDD's from Amazon next year.

  • This is very annoying. I'm currently awaiting delivery of a product from Amazon USA that was not available at all on Amazon AU.

  • Amazon UK may be a better option than Amazon AU?
    Is it Gerry Harvey's Birthday today?

    • "Australians will be blocked from shopping on Amazon's international websites"

      There's a good chance that this will impact ALL of the Amazon sites, not just the US one.

    • Gerry Harvey lobbied the liberals hard to make this happen. He must be a happy man; spend a few thousand dollars on bribes, get millions in extra profits.

      Next on his agenda is reducing the wages he has to pay:

      Retailer Gerry Harvey says Australia needs a two-tier wage system to allow employers to pay foreign guest workers less than locals.
      https://www.macrobusiness.com.au/2017/08/gerry-harvey-moonsh...

      • Then he's in for a pretty empty victory, because the things Amazon sells he doesn't - and the people with slightest amount of savvy to buy from Amazon, already knew the things he does sell are still available cheaper elsewhere. He's achieved nothing except guaranteeing less people will shop at Harvey Norman out of revenge.

        • This is exactly what I wrote in my letter to my local MP; I will no longer shop in any of his stores, and as the items I buy frequently overseas are not available in Australia, no one wins here.

          Remember, it was him that also was the Kogan of his time. The upstart has become the bully, and we all know how that ended for the companies he put out of business.

        • @drewbles: why would you tell your local MP that you are boycotting a particular store? He doesn't care.

      • Did anyone else see the Gerry Harvey interview on the ABC News Channel at 6pm?

        The man was absolutely barking mad, and almost incoherent.

        I thought Clive Palmer was bad - but Gerry is in a class of his own!!

      • This has been on tax office agernda for many years.

      • Heard him crowing on Sydney radio. Must think people are idiots with the lies he was spinning. Well actually he is right about that. Most people aren't too bright. Just look at the comments on smh to see how lots of people think any company selling to Australians should pay tax here boo matter where in the world they are located

      • Once his customer base fades away from old age he will wonder if it was all worth it.

    • Is it Gerry Harvey's Birthday today?

      Gerry gets to blow out 79 candles on 18 September.