Amazon announced today that they will no longer allow Australians to buy digital content through their USA portal and are forcing everyone to use the dedicated Australian page. The change is in response to a new tax regulation that goes into effect on July 1 and requires businesses earning more than $75,000 AUD a year to charge Australia's 10% Goods and Services Tax (GST) on low value items imported by consumers.
Amazon announced plans to block Australian users from ordering from its main USA store (Amazon.com) and will redirect customers to its local Australian site (Amazon.com.au) instead.
Australian shoppers using Amazon's worldwide site will be unable to place orders, with the retail giant stopping shipping due to new GST rules.
Amazon says its Australian unit offers 60 million products in 23 categories, compared to the more than half a billion products on its United States site.
This coincides with GST changes where online retailers will have to apply the 10 per cent GST to goods bought from overseas sites and shipped to Australia, where now the tax only applies to imports of goods above $1,000.
"Amazon Global Store will allow Australian customers to shop on amazon.com.au for over four million items that were previously only accessible on amazon.com".
Amazon will block Australia-based customers from buying products on its overseas sites when the goods and services tax is applied to all imported e-commerce items in July.
Amazon will soon be sub-prime, if you live in Australia.
"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 worldwide sites", an Amazon spokesman said in a statement on Thursday.
Shares in local e-commerce site Kogan.com gained 0.2 per cent to $9.09, while shares in electronics retailers JB Hi-Fi and Harvey Norman rose 2.4 per cent to $23.99 and 1.7 per cent to $3.60, respectively.
The country decided in 2015 to make the change, but since then an election, the replacement of its treasurer, a new prime minister, and lobbying against the move delayed its implementation until 2017.
"This isn't an anti-trade move by the Australian government", he said.