Amazon to block Australian customers from accessing USA site

It may also benefit Amazon's main rivals, from California-headquartered online market eBay to smaller Australian merchants which had campaigned to have the GST apply to all goods shipped from overseas. A loophole in tax regulations, however, means that the GST is now applied only to items purchased from overseas retailers if they are worth $1,000 AUD or more, which many local companies argued gave Amazon, eBay and other overseas competitors an unfair advantage.

Amazon will block Australians from buying from its global e-commerce websites and restrict them to a smaller local platform from July in response to new tax rules that consumer advocates fear will reduce the range of choice for customers in Australia. Inc said on Thursday it will force Australians to use its Australian website instead of its much larger USA site to avoid a new sales tax, setting the stage for a showdown with rival eBay Inc in the No. 12 economy.

The move will drive traffic to Amazon's Australian website, which has drawn criticism for a thin product range and uncompetitive prices since it began taking orders in December.

The changes referred to relate to a decision to scrap the previous $1000 threshold for imposing GST on online purchases from overseas. Most Australians have decried the store as being inferior to the USA store, with a considerably thinner product catalog and higher prices.

New Zealand had also already applied GST to digital services from offshore, such as Netflix in 2016.

Last year, it was announced that Aussies would have to pay GST on all overseas purchases from July 1, 2018, leaving the country's online shopping future uncertain in the process.

"I think it is disappointing that Amazon have taken this out on consumers in Australia but that is their commercial position", Mr Morrison said.

Treasurer Scott Morrison said the new laws "level the playing field for Australian businesses".

Amazon said it regretted the change which it blamed on the new tax rules.

He said the company 'had to assess the workability of the legislation as a global business with multiple worldwide sites'.

Amazon's Australia site boasts of selling over 60 million products, while Amazon's main site (the United States version) boasts of selling over 500 million.