Amazon bans Australian shoppers in GST revolt that experts say could force up prices

GLOBAL retail Amazon might be the first of many retailers to ban Aussie shoppers from their online stores and it could raise the price of everything from clothes to electronics.

AUSTRALIAN shoppers could be forced to pay more for everything from clothes and handbags to electronics after global retail giant Amazon revealed it would stop Australians buying goods from its biggest online store when new tax rules come into force.

The move will mean Australians won’t be able to access almost 90 per cent of products sold on Amazon.com after July 1, when the Federal Government starts collecting the GST on all products purchased overseas.

But retail experts warned that Amazon could be the first of many overseas firms to kick Australians out of their stores, with international fashion and department stores also at risk of following Amazon’s lead, in a trend that could see the cost of goods rise.

Harvey Norman founder Gerry Harvey said the move showed Amazon was still trying to “bully” the Federal Government into a tax backdown, and called on Australians to “blacklist Amazon in retaliation”.

Retail experts warn that Amazon could be the first of many firms to kick Australians out of their stores.

The multibillion-dollar global retail giant revealed plans to prevent Australians from making purchases at its US and UK stores on Thursday in an email to customers, blaming “changes to the Australian GST law”.

From July 1, the 10 per cent tax will extend to all overseas purchases, and businesses with a turnover of more than $75,000 will be required to collect the tax.

“While we regret any inconvenience this may cause customers,” Amazon said in a statement, “we have had to assess the workability of the legislation as a global business with multiple international sites.

“Based on our assessment, we will redirect Australian customers from our international sites to Amazon.com.au where they can shop for products sold by Amazon US on the new Global Store.”

The ban is likely to force prices up for Aussie shoppers.

But Amazon Australia’s new online ‘store’ would only offer an additional 4 million products from US traders — just a fraction of the 562 million products listed for sale on Amazon.com.

Gartner principal analyst Thomas O’Connor warned Amazon’s move could be the first of many, with more stores tipped to turn Australians around at their border.

“Australian consumers have become quite accustomed to purchasing from large overseas retailers, Amazon begin the biggest example but also department stores like Nordstrom’s, Macy’s, and global retailers like ASOS,” he said.

“This could be the start of a trend where there are more restrictions placed on shipping to Australia. It would be surprising if others don’t join Amazon.”

Mr O’Connor said the Australian online shopping boycott would not only make it harder for buyers to find collectibles, but it could force up the price of goods across the board.

“(Price rises are) a definitely possibility,” he said.

“If there are more retailers who join Amazon by doing this, that becomes more and more real, and more and more likely.”

Late yesterday, however, eBay backed away from its earlier threat to force Australian shoppers to use its local store only, with managing director Tim MacKinnon confirming “we won’t block Aussie buyers, redirect them, or require them to pretend they are located overseas”.

Australian entrepreneur Gerry Harvey singled out Amazon, saying its latest move was another case of it thinking “it’s that big that it can bully everyone else, including governments”.

He said Amazon should have been collecting the GST on purchases “for 10 years” and called on Australian shoppers to boycott the company.

“They’ve been evading this tax for years that we all had to pay. Now they say it’s not fair. What a hide. What a hide that they would scream and go on like this and then blacklist Australians,” Mr Harvey said.

“What sort of people are they? Everyone in Australia should blacklist Amazon in retaliation.”

Originally published as Amazon bans Australian shoppers in GST revolt that experts say could force up prices