Online buyers warned of hidden GST costs

Customs brokers are warning shoppers bringing in goods they have bought online overseas to beware of hidden costs.

New Zealand retailers are concerned they are losing out to overseas online shopping worth up to $500 million a year.

Customs Brokers and Freight Forwarders Federation president Willie van Heusden said private importers needed to be aware of handling fees and service fees being passed on by a courier company or whoever is responsible for bringing the goods in.

If duty and equivalent GST is less than $50 (the de minimis) an import effectively enters New Zealand duty and tax free, he said. By default, this gives a GST-free import allowance of $400 as $50 is 12.5 per cent of $400.

"Any movement in freight or cost of goods or indeed reduction in exchange rate or increase in GST would push these over the de minimis and there would be a charge."

If the GST rate goes up to 15 per cent then the private duty free threshold could fall to $333. But local retailers say they will still be affected by the rise, with one adding there is very poor enforcement.

Dive shop owner Aaron Bolton said there appeared to be very little attempt to collect GST on personal imports. He said he had customers coming in having bought items "well over $1000 and still had no GST collected".