Call for level GST playing field

Many consumers are opting to shop GST-free on overseas websites, but they still expect local retailers to share their expertise and deal with problems when things go wrong.

Retailers' Association chief executive John Albertson is calling on the Government to investigate ways to charge GST on items bought online from non-New Zealand companies.

"While each transaction, on its own, is relatively small, we estimate it adds up to turnover of about $1 billion."

Personal imports of less than $400 are not subject to GST, which he said encouraged Kiwi consumers to try things on in local shops or use the expertise of the retailers, then buy more cheaply offshore.

"We are not asking for a stop to competition - that's what the market's about. What we are asking for is a stop to the inequality."

But how do you charge GST on electronic transactions offshore? Albertson admited the association did not have a solution. However, he estimated offshore shopping was costing the Government $100 million a year in lost GST and said the impact on retailers meant it was also costing the country jobs and personal and company taxes, making research into collecting this lost GST a good investment.

Outdoorsman Headquarters' managing director Bryan French said people had been getting information locally to buy internationally for at least a year and he agreed with charging GST on overseas purchases.

He also warned shoppers that the Consumer Guarantees Act did not apply to purchases outside New Zealand and buyers could not expect to take faulty items from overseas into local stockists to sort out.

"People come in and think, because it is a brand we stock, we will be able to help them. Unless you have proof of purchase, we cannot support [you]."

French said warrantees had to be followed up through the retailer who sold you the goods.

The Rock Shop manager Daryl Cogger agreed the internet was a strong competitor in his sector and said The Rock Shop group closely monitored internet prices to keep its stores competitive.

"But GST is an issue. If [customers] buy something from you, they have to pay it. If they buy elsewhere in New Zealand, they have to pay it. It seems fair and reasonable that if someone brings a product in from overseas they should be charged GST to a threshold that makes it viable."

Cogger said he also had people coming in wanting to sort out warrantee issues with products bought online and warned people to beware of rip-offs from some websites.

But people do not just want local stores to sort out problems. The Retailers' Association has indicated that many people go to stores for free advice and then buy online.

House of Travel Rotorua director Pam Turner said this was not just confined to overseas sites.

"Either you are on your own and do the bookings yourself or you pay us for our expertise."

Turner said customers often booked some of their trip through an agent and organised some themselves, but then had to take responsibility for anything that went wrong in the self-service part.

"We have had people book a hotel themselves and then come back and complain about it to us."