Retailers’ relief as uncompetitive GST loophole is to be closed

 

Bookshops and other small businesses and their communities across New Zealand will have a sense of relief that the loophole allowing offshore retailers  an unfair 15% price advantage when selling into New Zealand is to be closed, finally.

“Closing this loophole will remove the unfair 15% competitive advantage enjoyed by offshore online retailers that kiwi small businesses have had to face each day before they even open their shop doors,” said Lincoln Gould, CEO of Booksellers NZ, commenting on the joint announcement today of Ministers Nash and Whaitiri that following legislation, GST will need to be collected by offshore retailers from 1 October next year.
“We hoped that the enactment of the proposed legislation would have been earlier than October next year, but we have been working, along with Retail NZ and others,  to have this loophole removed for so long that we are happy that we now have a date.

“We are pleased that the issue was fast tracked through  the Tax Working Group and that Minister Nash in particular has been able to bring this project forward building on the work the previous National Government had done.

“This won’t suddenly make books and similar goods from small retailers cheaper than can be bought from giant offshore retailers with their huge advantage in purchasing power. But it will provide a better opportunity for shops to compete with service and curation of their goods. Thus the experience of shopping local  will be more economic and pleasurable.

“Over time we will see, bookshops employing more local people and extending their place as cultural and community hubs”, said Gould.

Booksellers NZ will prepare a detailed submission on the government discussion document.