“The tax loophole is not about retailers, it’s about all New
Zealanders” Retail NZ Chief Executive Mark Johnston said yesterday. The
loophole is threatening local town centres, costing Kiwi jobs, and eroding the
tax base. The Government is missing out on more than $200 million a year in GST
and duty on low value goods alone – funding that could pay for at least 4,345
new first-year primary school teachers, or more than 9,000 hip replacements
every year.
Booksellers NZ Chief Executive Lincoln Gould says that
independent bookshops are among the small businesses most impacted by the
current loophole. "Booksellers, like other retailers, are finding it hard
to compete with foreign websites because they start with a 15 percent price
disadvantage. We know that bookshops throughout New Zealand would sell more
books and employ more New Zealanders if the tax loophole was closed.”
Retail NZ's Mark Johnston says that New Zealand's $400
threshold is out of step with other countries. "Taxes like GST are supposed
to be applied universally. Low value thresholds apply in other markets too, but
they are generally much lower than ours – at between NZ$20 and NZ$30. In New
Zealand, you can generally import goods worth up to $400 before needing to pay
tax. This just isn't fair."
The #eFairnessNZ campaign asks the Government to set up a
system for overseas companies to register for GST and collect the tax just like
New Zealand based retailers. At the same time introducing a $25 threshold for
low value goods, where GST and duty has not been pre-paid, to be collected at
the border before the items are released. Goods worth more than $25 should be
levied to cover the cost of customs and biosecurity clearance, as happens in
most other countries.
As part of the #eFairnessNZ campaign, Retail NZ and
Booksellers NZ members are writing to politicians and telling the public about
the serious affect the tax loophole is having on their businesses. Follow the
campaign on Facebook, Twitter and Instagram using the hashtag #eFairnessNZ and
on the website www.retail.kiwi/eFairnessNZ.
1 comment:
In Australia the GST value limit is $1,000, so NZ isn't "out of step" with Australia. The Government knows that this doing this would be electorally unpopular so is probably only going through the motions to appease retailers who want to stock imported items instead of local products, which is what they should be doing. But the present Government is responsible for hiking the rate to 15% - compare that to 5% in Canada. When it comes to paying "their fair share" of tax, big corporates and wealthy businesspeople who exploit loopholes are the culprits and the ones who should be targeted.
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