More nonsense re GST on overseas purchases

The Herald reports:

Nearly 40 per cent of New Zealanders believe GST should be charged on all purchases made on foreign shopping websites, a survey has shown. …

A Herald-DigiPoll survey this month found that almost 55 per cent of the 750 New Zealanders polled had bought goods from foreign websites.

Of those surveyed, 53 per cent said the $400 exemption should not be removed as the tax would be too inconvenient to collect.

Surprisingly, just under 40 per cent – 38.5% – agreed with the view of the Retailers Association that the 15 per cent GST should be applied to all overseas online purchases to level the playing field for local retailers.

This is like polling people on whether they would like more sunshine. You can want it, but it doesn’t mean it will happen.

Unless overseas companies decide to volunteer to collect tax for the NZ Government, then the only way you can apply GST to all purchases made on those sites is to have Customs impound every single letter and parcel sent from overseas, open it, assess its value, invoice you for the GST, and refuse to hand it over until you pay the GST. It would cost the Government hundreds of millions of dollars and piss off around two million or more NZers who would find that they no longer get mail from overseas delivered to them.

Labour Party revenue spokesman David Clark said the Government “needs to explain to New Zealand businesses why they should be disadvantaged by having GST collected when overseas business don’t face that challenge”.

“It seems it would be pretty simple to speak with Amazon and other suppliers to ask them to collect GST since they collect, as I understand it, sales taxes for individual states in the US. If that’s true, then it’s obviously an ideological decision from the Government not to collect it.”

David Clark is a smart guy, but he sounds like a moron when he speaks such tripe. Amazon is a US company and obliged to collect tax for the US Government from US citizens. It is not a NZ company and the NZ Government has no power to force it to collect GST for us.

To say that Amazon not charging GST to NZ customers is because of an ideological decision of the NZ Government is one of the most patently false and stupid things a NZ politician has said this year.  Perhaps a journalist could ask David Clark if he will guarantee that under a Labour Government, Amazon would collect GST for the NZ Government?

Political commentator David Farrar posts at Kiwiblog.