Australian shoppers are furious after Amazon limits their access over sales tax laws

SYDNEY, Australia — Amazon’s decision to deny Australians access to its main website has set off a backlash in the country, with customers complaining they may face big price increases and a loss of access to sorely needed products.

The e-commerce giant made the move, which it announced on Thursday, in response to changes to Australian tax law that will require online retailers to charge a 10 percent goods and services tax on products sold and shipped from overseas. That tax currently only applies to items bought overseas costing more than $1,000.

In an email to customers, Amazon said Australians would be redirected to the amazon.com.au site starting July 1 to ensure that the tax was applied.

Rebecca Wong, a visually impaired Sydney resident, said she feared she wouldn’t be able to afford the talking MP3 player that helps her choose and listen to music.

“The companies which produce these sorts of goods often don’t ship directly to Australia, or shipping is prohibitively expensive,” she said. Amazon’s international site, she added, “has the infrastructure to be able to ship them at affordable prices.”

Amazon has tried to convince customers that the change won’t inhibit their ability to shop. They told customers that the Australian site had more than 60 million products, and tried to soften the blow by offering a $20 gift voucher to amazon.com.au.

But customers were quick to point out that this was a far cry from the hundreds of millions of products they could browse on Amazon’s main site.

Emma Shaw, a musical theater performer, said she was likely to have a hard time finding hard-copy albums for Off Broadway shows like “Spamilton” on the Australian site.

Some have accused the Australian government of using the tax to cut down on imports. But Dr. Jim Minifie, an economist with the Grattan Institute, an Australian research organization, said the government was merely trying to make sure overseas-based online retailers didn’t gain an unfair competitive advantage.

“This isn’t an anti-trade move by the Australian government,” he said. Countries around the world were “simply facing the same challenges about how to raise this form of revenue in a global economy.”

“It’s been argued that this is like an import tariff, but for years in Australia we’ve had something of a reverse: Local retailers paying a tax that foreign retailers haven’t,” he added.

That view was echoed by Mark Rubbo, the managing director of Readings, a Melbourne bookshop chain.

“I’ve been pushing for this for years,” he said, adding: “Retailers like Amazon and their subsidiary the Book Depository have been able to avoid collecting G.S.T. from Australian customers whereas we are legally bound to collect, so immediately we are at a disadvantage.”

Ms. Wong, the visually impaired Amazon customer, said the company’s main site offered products she just couldn’t get from Australian retailers, including many designed to help visually impaired people like her.

In a statement about the change, Amazon said it regretted “any inconvenience this may cause customers.” It also said that in addition to the 60 million items available on the Australian site, “the global store will allow Australian customers to shop on amazon.com.au for over four million items that were previously only accessible from amazon.com.”

Dr. Minifie, the economist, said that Amazon would probably continue to build a healthy customer base in Australia despite the change.

“Amazon’s huge scale leaves them in a far better position” than other overseas-based retailers, he said. “A lot of smaller online retailers overseas are going to find the new tax an additional layer of complexity.”

“The trade-off here is that the government can make the playing field totally neutral as to whether you are buying overseas or locally, though at some cost to the consumer,” he added.

Source: Tech CNBC
Australian shoppers are furious after Amazon limits their access over sales tax laws