Why has Amazon stopped shipping to Australia?

The Amazon Echo in the Australian Shipping Void: Why the Packages Stopped Arriving

For a while there, Australian consumers used to browsing the vast digital aisles of Amazon and having almost anything delivered to their doorstep were met with a frustrating, and frankly confusing, change. Suddenly, a large swathe of international products became unavailable for shipping Down Under. The question on everyone’s lips was: Why? What sparked this sudden shutdown of Amazon’s global reach to Australia?

The answer, in short, comes down to tax: the implementation of Australia’s Goods and Services Tax (GST) regulations. While Amazon operates in Australia with a dedicated Australian marketplace (Amazon.com.au), the issue specifically concerned goods purchased from Amazon’s international sites (like Amazon.com) and shipped directly to Australian addresses.

Before the regulatory changes, goods valued under AUD$1,000 imported into Australia were exempt from GST. This meant Amazon, or more accurately, the individual vendors selling through Amazon, didn’t need to collect or remit GST on these smaller international orders. However, this changed dramatically.

The Australian government introduced a new law requiring overseas businesses selling goods to Australian consumers to collect GST on all goods, regardless of their value. This was a significant shift, designed to level the playing field for Australian businesses who were already required to charge GST.

Amazon’s response was swift and, for many Australians, disappointing. Instead of implementing the systems required to collect and remit GST on every international purchase, Amazon chose a more drastic path: it simply stopped shipping a significant portion of its international inventory to Australia.

The company cited the complexity of adapting its systems to comply with the new regulations as the primary reason. Effectively, they were saying that figuring out how to collect and remit GST on potentially millions of individual transactions, across countless sellers and product types, was too challenging and costly for the perceived benefit.

This decision sparked considerable debate. Some lauded Amazon for taking a principled stance, arguing that the GST regulations were overly burdensome and created unnecessary complexity. Others criticized the move as a way to force Australian consumers to utilize Amazon.com.au, where they are already collecting GST, even if the desired product wasn’t available or was priced significantly higher.

While Amazon eventually adapted its systems to re-enable some international shipping, the experience highlighted the significant impact of tax regulations on international e-commerce. It served as a stark reminder that the ease and convenience of global online shopping can be disrupted by seemingly mundane, but ultimately crucial, factors like tax collection and compliance.

The Amazon shipping void in Australia, while partially filled again, stands as a case study in the complexities of international trade and the sometimes-unpredictable responses of global corporations to local regulations. It also underscored the importance of understanding the fine print of online shopping, reminding consumers that seemingly simple clicks can trigger a complex web of international tax laws and logistical considerations.