Tax & Accounting Blog

New Zealand’s GST “Netflix” Tax Set to Commence

BEPS, Blog, Checkpoint, ONESOURCE, Transfer Pricing October 3, 2016

The application of New Zealand’s GST to digital and remote services sold by offshore sellers to New Zealanders (the so-called “Netflix” tax) commences on October 1, 2016. See BEPS Action 1. The rules apply to sales by offshore sellers (which could include sellers from Singapore, Australia, Hong Kong, and elsewhere) to New Zealand private consumers.

From October 1, 2016, non-resident businesses supplying remote services (including online services) to New Zealand consumers may be required to do both of the following:

  • Register for New Zealand GST.
  • Charge GST on services provided to customers resident in New Zealand.

A non-resident business would need to register for GST when all of the following apply:

  • It exceeds the GST threshold, i.e., its sales: (i) exceed NZ$60,000 in the last 12 months, or (ii) are expected to exceed NZ$60,000 in the next 12 months.
  • Its customer is resident in New Zealand.
  • It supplies a qualifying remote service. A “remote” service is where, at the time of the performance of the service, there is no necessary connection between the physical location of the customer and the place where the services are performed. A qualifying remote service would include:
    • Supplies to digital content such as e-books, movies, TV shows, music and online newspaper subscriptions;
    • Online supplies of games, apps, software and software maintenance;
    • Webinars or distance learning courses;
    • Insurance services;
    • Gambling services;
    • Website design or publishing services;
    • Legal, accounting or consultancy services.


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