"We have taken this step to provide our customers with continued access to worldwide selection and allow us to remain compliant with the law which requires us to collect and remit GST on products sold on Amazon sites that are shipped from overseas", said Amazon.
The GST amendment lowers the current minimum spend for GST inclusion from $1000 to $1 in response to backlash from local retailers.
The company said today that shoppers in Australia will be redirected to its local site, Amazon.com.au, and that its global sites, including Amazon.com, will no longer ship to Australian addresses. But taxes seem unlikely to protect brick-and-mortar shops from Amazon-.com or.com.au-in the long run.
Australians will be able to access their new global store which has four million products.
New Zealand had also already applied GST to digital services from offshore, such as Netflix in 2016.
Amazon's primary site, Amazon.com, will be inaccessible in Australia, with buyers diverted to the local store, which has been heavily criticised for its higher prices and lesser variety. Hundreds of thousands of customers will lose access to their ebooks on July 1st because Amazon does not allow customers to transfer Kindle purchases from one country to another.
The government would not back down on the new tax rules, which would raise AU$300 million a year, Morrison said. "That tax revenue is used to fund essential services", the spokesperson said.
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.
A Productivity Commission inquiry concluded that given the decision to collect GST on low value imported goods, "the legislated model is the most feasible among the imperfect alternatives at this time".
"A level playing field will help Australian businesses grow and create more jobs and opportunities", the Treasurer's spokesperson is reported to have said.
National Retail Association CEO Dominique Lamb said Amazon's move was a surprise.