With the Federal Budget for 2015 due to arrive tomorrow night, Federal Treasurer Joe Hockey has confirmed that the rumoured 'Netflix Tax' on digital services will be introduced by the Australian government.
Though Netflix launched in Australia under the notion that it would be GST-free, Hockey said during a press conference this afternoon that Netflix, along with other digital services, would have to charge a 10 per cent Goods and Services Tax set by the Federal Government.
Mr Hockey stated that "It is plainly unfair that a supplier of digital products into Australia is not charging the GST whilst someone locally has to charge the GST."
Tax off… Tax on
While Netflix is the focus of the new tax, there's reason to believe that it will extend to other overseas digital services such as Uber and Steam.
Hockey admitted that digital services are new territory for GST legislation, stating that "it did not anticipate the massive growth in the supply of digital goods like movie downloads, games and e-books from overseas."
- Curious about Netflix? Read our in-depth Netflix review