New laws means less bang for your buck

Weekend sales have rolled over into Cyber Monday but new tax laws that came into force yesterday means overseas goods purchased online will be more expensive.

Products that cost less than $1000 are now subject to GST.

It's a move designed to make it easier for New Zealand companies to compete with massive corporations like Amazon - who up until Sunday didn't have to pay the tax.

Greg Harford from Retail NZ told Morning Report it didn't make sense to only charge GST domestically.

"It's absolutely right that everyone playing in the New Zealand market plays by the same set of rules and pays the same taxes."

But it's important to remember GST was already being charged at the border in some cases, he said.

"Some people would have been getting nasty surprises if they ordered a $300 pair of shoes, that product should have been previously taken a aside by customs, they would have charged GST plus a $50 processing fee on top of it, so actually for those people it should be a more seamless process."

New Zealand isn't the only country that charges tax on incoming goods, he said.

"The big retailers are already complying with these laws internationally and there's no reason why they wouldn't here."

This article was originally published on RNZ and re-published with permission.

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