Finance Finance News Netflix tax to hit ‘most Aussies’

Netflix tax to hit ‘most Aussies’

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The government’s planned tax on goods and services purchased online will affect up 60 per cent of Australians, a new survey by Nielsen has found.

Sixty per cent of Australians shopped online at least once a month in the first quarter of 2015 – a huge 20 percentage point increase on the 2014 figure.

Of that 60 per cent, 40 per cent bought products GST-free from the United States.

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The new 10 per cent tax will initially apply only to digital products such as movies and music, but is likely to extend to other products in coming months, said Head of Nielsen’s Retail Industry Group Kosta Conomos

Despite this increase, Mr Conomos said the new GST is unlikely to spook consumers.

“The changes to the GST will affect most Australian consumers, however we don’t predict this will greatly affect their decision to buy from these retailers,” he said.

“The Australian consumer is exhibiting a large appetite for online shopping for the convenience, extended choice and cost saving factors. This is predicted to continue to grow, particularly for a time-poor, hardworking community.

“Having said that, that 10 percent difference could be the deciding factor between going with one retailer over another, and the psychological effect of knowing the tax exists for these retailers could see consumers buying locally more often.

“We are also seeing in this report that 62 percent of Australia have changed their spending to save on household expenses, so despite optimism, there is still a movement towards being more frugal,” Conomos said.

Interestingly, the survey also revealed a significant boost in online consumer confidence, even though it was carried out before the budget.

Forty-five per cent of respondents believed it was a good or excellent time to buy the things they want or need, up four percent on 2014. Meanwhile, 57 per cent said they felt positive about the state of their personal finances, up two percent from quarter one, 2014.

On the job front, 38 per cent of respondents felt positive about the next twelve months, up four percent points on 2014 and two per cent from the previous quarter. This goes against the recent rise in unemployment.

Since the release of the federal budget last week, surveys by ANZ-Roy Morgan and Westpac have reported a boost in consumer confidence.

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