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The retail giant said it would subject Australians to the
process known as "geoblocking" from July 1, when a 10 percent
Goods and Services Tax (GST) applies to imported online goods
worth less than A$1,000 ($756).
"While we regret any inconvenience this may cause customers, we
have had to assess the workability of the legislation as a
global business with multiple international sites," an Amazon
spokesman said, adding that the firm was taking the measure to
comply with the legislation and not to avoid paying tax.
The move will likely drive traffic to Amazon's Australian
website, testing the patience of shoppers who have complained
about its thin product range - a tenth the range of its U.S.
site - and uncompetitive prices since it began taking orders in
December.
It may also benefit Amazon's main rivals, from
California-headquartered online market eBay to smaller
Australian merchants which had campaigned to have the GST apply
to all goods shipped from overseas.
National Retail Association CEO Dominique Lamb said Amazon's
move was a surprise.
"You have to wonder if they are trying to funnel more traffic to
its Australan website," she said.
An eBay spokesman said the U.S. company was working on a way to
collect the Australian tax from sellers around the world without
cutting access for Australians.
"eBay's GST solution ... allows imports to Australia to continue
without any structural barriers, redirects or blocks to the
buyer experience," he said.
FAIR SHARE
Until now, GST has applied only to most goods sold in Australia
and imported goods worth over A$1,000, making relatively
low-cost imported items cheaper than their equivalents in local
stores.
Australian Treasurer Scott Morrison announced the change in
April 2017, eight months before Amazon opened its Australian
unit.
"The second-biggest company in the world, run by the richest man
in the world, shouldn't get a leave pass from paying tax in
Australia," Morrison said in an email statement on Thursday.
"If multinationals aren't forced to pay their fair share of tax,
they will have a competitive advantage over retailers here in
Australia, on our own main streets and in our shopping centers."
Shares of local e-commerce site Kogan.com Ltd closed up 0.8
percent while shares of electronics retailers JB Hi-Fi Ltd and
Harvey Norman Holdings Ltd, seen as direct Amazon competitors,
closed up 2.2 percent and 1.4 percent respectively. The broader
market rose 0.4 percent.
(Reporting by Byron Kaye; Editing by Stephen Coates)
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