Disclosure statement
No potential conflict of interest was reported by the authors.
Notes
1 See PwC New Zealand, ‘Tax by the Megabyte—New Zealand's GST in our Digital Economy’ (August 2015), https://www.pwc.co.nz/pdfs/pwc-tax-by-the-megabyte-nz-gst-and-offshore-online-purchases.pdf.
2 Goods and Services Tax Act 1985 (‘the GST Act’), s.8(3).
3 GST Act, s.8(1).
4 €20.4–23.3 million, OANDA, https://www.oanda.com/currency/converter/ on 17 May 2018.
5 Ibid, €29.1 million.
6 Ibid, €93.3 million and €64.1 million respectively.
7 Inland Revenue (New Zealand)—Policy and Strategy Division, ‘GST on Cross-Border Supplies of Remote Services, a Special Report’ (May 2016), http://taxpolicy.ird.govt.nz/sites/default/files/2016-sr-gst-cross-border-supplies.pdf.
8 Taxation (Residential Land Withholding Tax, GST on Online Services, and Student Loans) Bill 2015 (93-1).
9 See PwC South Africa, ‘Extensive Reform for Suppliers of Electronic Services’ (February 2018), https://www.pwc.co.za/en/press-room/extensive-reform-for-suppliers-of-electronic-services--0.html.
10 GST Act, s.8(4D).
11 See GST Act, ss. 8(4D) and 11A(1)(x).
12 GST Act, s.8B(7) and (8).
14 New sub-s. 11A(1)(jb) of the GST Act has been included to cover services that involve the arranging of underlying services that are referred to in sub-s. 11A(1)(j).
15 One example relates to travel insurance and involves an insurance provider arranging other services (such as overseas accommodation) that are physically performed offshore in the country the traveller is located in. This should be zero-rated as the underlying service (which is not a remote service) is consumed outside New Zealand. Other examples include: (a) remote services which involve the facilitation or arranging of services that are physically performed offshore and the ultimate service requires the customer to be in the same location where the physical performance is performed e.g. overseas accommodation; (b) an inability to zero-rate financial services performed offshore, even though this was clearly possible under the previous version of sub-s. 11A(1)(j).
16 Because the threshold is measured by reference to tax payable, a rate increase would lower the value of goods that would trigger collection of the GST and tariff duty.
17 GST Act, s.1(1), first paragraph of the definition of ‘electronic marketplace’.
18 GST Act, s.60C.
19 GST Act, s.60(1C).
20 European Commission, ‘Modernising VAT for E-commerce: Question and Answer’ (December 2017), http://europa.eu/rapid/press-release_MEMO-16-3746_en.htm.
21 OECD, ‘Addressing the Tax Challenges of the Digital Economy, Action 1—2015 Final Report’ (October 2015), http://dx.doi.org/10.1787/9789264241046-en at 208.