New tax means that all your online shopping is about to get more expensive


Well this is not ideal for the online shopping lovers amongst us (UM, ALL OF US).

We're all reasonably familiar with the tax that came in for purchases from overseas over $400 but now GST will be applied to online purchases under $400 too.

Prime Minister Jacinda Ardern, argues that the tax isn't new, though. Speaking to Newstalk ZB she mentioned that GST has always been applied to those purchases but never collected due to collection issues.

But what we're basically hearing is that our online shopping is going to cost us more now.

GST is payable on all goods bought in New Zealand, including overseas online purchases such as books bought on Amazon or Book Depository or goods from Alibaba and eBay. But the cost of collecting it on small things such as a $40 book, means it is not collected.

A review in 2015 found the government was missing out on about $180 million a year by not collecting GST on online purchases, including $40m from shopping on iTunes, Netflix, Spotify and other online services.