WELLINGTON, June 30 (Xinhua) -- New Zealand retailers expressed dismay Thursday when the government said it will wait till at least 2018 before applying a sales tax and duties to low-value online purchases.
Customs Minister Nicky Wagner said Customs was continuing to look into different ways of effectively collecting the goods and services tax (GST) and duties for low-value imports before proposing to lower the collection threshold from the current level of 60 NZ dollars (43 U.S. dollars).
"The volume of low-value goods imports has grown by about 14 percent per annum and is expected to double over the next five years," Wagner said in a statement, admitting the current threshold was unfair on New Zealand retailers who paid taxes on bulk shipments.
"The government acknowledges that a lower threshold would help to level the playing field, but there's no quick or easy solution," said Wager.
Lowering the threshold too soon would incur a risk that goods might be held up at the border needlessly, and that collection costs would exceed revenue gained.
"Once Customs has a better understanding of the best ways to collect tax for low-value imports, we will look to lower the threshold, potentially from the 2018-2019 financial year," she said.
"While that would be fairer and help to protect the integrity of our GST system, it would not be appropriate to propose any changes in the short term without appreciating its impact on industry and consumers."
The Retail New Zealand sector group said the continued inaction was putting retail businesses at risk and it urged the government to follow Australia, which recently announced it would require offshore e-tailers to register for GST from July next year.
"There is no good reason why the government can't follow the Australian lead and require foreign firms to pay GST on sales they make in New Zealand. This would then allow goods to flow smoothly across the border without disruption, as they do now," general manager Greg Harford said in a statement.
"Offshore collection of GST may not be a perfect solution, but it would be a significant step forward. The top 20 international e-tailers account for two-thirds of all international online sales to Kiwis and they generally already have the capability to collect GST at the time a sale is made," he said.
"It would be easy for the government to require them to pay their fair share of GST."
