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Australia Introduces 'Netflix Tax' On Digital Goods To Parliament

If legislation introduced by Treasurer Scott Morrison clears Australia’s parliament, digital goods such as e-books, games, apps and subscription streaming services from overseas providers will attract the Goods and Services Tax. It’s been dubbed the “Netflix Tax”, and is expected to raise $350 million for states and territories over the next four years.

As legislation currently stands, digital services provided by Australian companies attract GST, while overseas counterparts do not. However, Organisation for Economic Co-operation and Development (OECD) guidelines recommend that consumption be taxed in the destination country of imported digital goods and services.

Mr Morrison said the changes would “ensure Australian businesses selling digital products and services are not disadvantaged relative to overseas businesses that sell equivalent products in Australia.” The European Union recently implemented this system, while Japan and New Zealand are other countries currently working on a similar strategy. [SMH]


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