Shopping Overseas - Tips and Tricks for Kiwis

The newspapers are full of a government working party looking at whether New Zealanders who buy goods overseas, should pay GST on their imports. The New Zealand retailors think it’s a fantastic idea, purely, of course, in the interests of being fair!

Online purchase

Well the figures are in, and even in the unlikely event of someone discovering a way to collect GST on online overseas purchases which is fair and equitable, it won’t help the NZ retailors.

The figures are pretty compelling:

Best-selling paperback book:

Bought at the Wool by Hugh Howie NZ$12.33 (including free shipping). Compared to NZ$29.99 in a local bookshop.

Even if you had to pay GST on the import, that is a grand total of $1.85 - I would still be saving over 50%!

A Pair Of Levis

Or take clothes, slightly more complex but very doable. A pair of man's Levi Jeans 501 on cost US$45 say NZ$57. Now Amazon won't ship the item to a New Zealand address, that's common and means that Levi doesn't want New Zealanders bypassing the local franchise.

No problem. A new venture by NZ Post. allows you to use a US address without leaving home. Amazon will ship to this address for free. From there the cost to ship to New Zealand is about $26. So now our jeans a total price of just $83. Again even if the government brought in GST - we are talking about a tax 'grab" of $12 - so now jeans cost $95. So what do a pair of jeans cost in New Zealand? $130 to $150 seems to be the current pricing. So even if GST was charged - you are looking a saving of about 33%.

Staying Safe Shopping Overseas

Remember that it's up to you to do the leg-work. The Consumer Guarantees Act doesn't apply to overseas retailors, and it's unlikely to be cost effective to return goods once you factor in the postage, even if the store will take them back.

Stick with the big names: (books, clothing, laptops), (for books)

Paying GST and Duty

The limit above which you are charged GST isn’t $400 for all items. A few categories of goods still also have duty payable as well as GST. So for a rough calculation:

  • Books, computers, electronics GST plus admin fee - collected over $400
  • Clothing and footware 10%, duty plus GST plus admin fee - collected over around $250
  • Jewellery have a 5% duty - so the total price that you starting pay is around $300

For details on the calculation click here

Shipping can be cost more than the item itself particularly for heavy items like books. Minimize shipping by bulk ordering- more to reduce the per item shipping, but be careful of hitting the customs limits for charging GST/duty.

Shipping with a virtual US address is an exciting development. This opens up many more retailors for Kiwi shoppers. Many large American firms e.g. Logitech or HP will not ship to NZ but will ship to Oregon which is the Youshop virtual address is. This is entirely legal, for once too good to be true, is for real!

Do Your Homework

Remember that everything you are seeing on Amazon, is designed for the American market.

  • Note that US appliances work on 110V and have US style plugs
  • Will be imperial size
  • DVDs will be the wrong region code
  • Make sure than any manufacturer warranty is worldwide one and not a US-only policy

I've been shopping online for over a decade and have never lost a parcel. But be careful. Always use a credit card for maximum protection; the option of a charge-back gives you real protection. Consider using track and trace shipping for expensive items and make sure you understand who pays if the parcel goes missing.

New Zealanders aren't going to stop shopping online anytime soon. Our tiny domestic market means that anyone who has unusual interests, or is just bigger, taller, or smaller than the average will find many more option shopping online overseas, usually at a lower price.

The retailors may be shouting for “fairness”, but Kiwis are voting with their wallets for fair prices, and this is just the beginning of the online shopping boom.