Changes to Australias GST laws mean leading online retailer Amazon is planning to block Australian customers from placing orders on its US website.
From July 1, shoppers visiting the US site, or other overseas Amazon sites, will be redirected to local Australian site Amazon.com.au, launched last December. However, it is estimated that the Amazon block will put 90% of its products out of the reach of Australian consumers.
For some years, it has been claimed that overseas retailing giants such as Amazon and Apple, among others, harm local business and the Australian economy by selling items in Australia free of GST. Significant price differences make online goods much cheaper than those supplied locally.
Previously overseas goods ordered online avoided the GST if their value was below $1000. That limit is to be abandoned from 1 July, provoking Amazon's response. Speaking on Melbourne radio station 3AW, Treasurer Scott Morrison called Amazon's move “an overreaction” and “a bit of a sook”.
According to an article by Frank Chung on news.com.au, it will still be possible for Australian shoppers to beat local prices if they sign up for a VPN (virtual private network), and switch to a US IP address, as many already do for services like Netflix. It will still be necessary to pay 10% GST at customs, but that will be applied to the lower overseas price.