Last month’s announcement of a so-called “Netflix tax” – targeting the as-yet untapped tax revenue potential lying in the products we hold so dear—subscription-based streaming services such as Netflix, online music, ebook and movie downloads—has gained further traction ahead of the impending Federal Budget, with assistant treasurer Josh Fryndenberg campaigning that winter is coming re: adding about 10% to media products. ITunes customers will not be affected by the amended GST regulations, as Apple maintains GST is already added to song downloads in Australia.
Fairfax today confirms that the ‘Netflix Tax’ will be included in the upcoming budget, and claims that an adjustment of the current GST laws to include products such as Netflix is a fairly simple one to make. In other words, this is happening, and in all likelihood, happening soon.
A review in 2012 estimated that GST on products such as ebooks and movie downloads would amount to approximately $1 billion in tax revenue. This review naturally took place before the recent arrival of Netflix down under, which will undoubtedly further this figure to even loftier heights.
Adding 10% to a streaming service in a country where consumers are already hesitant to forgo piracy for legal avenues? When they’re all but running to the sweet merciful embrace of VPNs and accessing American Netflix anyway? The proposed GST inclusion has some flaws, to say the least.
In a move that may add insult to injury, old mate Fryndenberg is also reportedly championing a lowering of the current tax threshold on overseas parcels – currently sitting at $1000. At present, customers purchasing overseas goods under $1000 enjoy a tax-free “loophole”- effectively setting unfair competition for local retailers. Fairfax reports the earlier considerations by the government set the lowering by half—to purchases $500 and over—however, Fryndeberg is reportedly considering a further Southward push of the threshold, potentially taking heed from Canada, where similar tax laws set a threshold at purchases $20 and above.
NSW Premier Mike Baird and SA Treasurer Tom Koutsantonis have publicly supported the threshold lowering.
The exact parameters of the threshold lowering are yet to come. But in the interim and while you still have time, you know what this means.
via SMH.
