Newspaper Extract

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Retailers back GST for online overseas shopping

Prime Minister John Key has warned online shoppers that they could soon be hit with GST and overseas online shopping would get more expensive. He is planning on to secure the rules on GST as GST is not currently been charged on imported goods, digital products such as downloaded music and film bought online which is worth less than $400. According to New Zealand Retailers Association chief executive, Mark Johnston off shore online shopping is about 40% and therefore government is losing more than $200 million plus additional tax revenues.

The Retailers Association has also been urging Government to put in GST to online shopping as they are struggling to compete with lower pricing online. The most affected by overseas online sales are clothing, footwear, books, sports gear and music retailers. Due to low prices and GST not being charged on off shore online shopping the retailers are unable to compete equally hence leading to closure of many shops locally and this therefore resulting in job losses.

The issue of GST not being charged on offshore online shopping has impacted both the business and the economy. From the article we can see that 40% of people shop offshore online and this number could increase in coming years, due to this local retailers are unable to compete with foreign websites hence this is leading to closure of some of the shops. Therefore, there are job losses due to this. This in return affects the economy of the country as the percentage of unemployment increases and there

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