Geoblock sounds like a scary word. Because it is.
Geoblocking is when websites block users who access their websites from a certain geographical location (such as Australia). Unfortunately, geoblocking is exactly what some of the world’s largest online retailers are considering doing to Australia.
Due to the Australian Government’s slated changes to the GST (and the financial effect it will have on online retailers), eBay, Amazon and Etsy are hinting at geoblocking Australian IP addresses. If they go through with the geoblock it means Aussies will have far less choice when online shopping.
The changes to the GST mean that any overseas business with an annual turnover greater than $75,000 have to register with the Australian Taxation Office to collect GST on all goods sold to Australian consumers.
The laws will go into effect of July 1 2017, forcing companies like ebay to act in what they say is their best interests.
Jooman Park, Country Manager for eBay Australia & New Zealand said,
“It is a huge, global business risk.”“Even if we were given [more time], we are not sure we will end up making the decision to create this tax collection capability. We run an $80 billion business based on one global platform. Your requirement is almost the same as just developing a separate Australian site.”“It will cost a lot to invest, and second, under the bill we are subject to the financial risk — if our sellers refuse to pay GST, we are liable for that.We don’t understand why we have to take that financial risk.”
“Quite honestly we’re left with a number of unfavourable options, and [denying access] is our absolute worst-case scenario.”
“Blocking stay-at-home mums from being able to achieve a sale is frankly devastating for us and our business model.”
There’s no word on how the government is going to implement a taxation model like the one that has been proposed. It IS certain, however, that no one wants to be locked out of the global marketplace just because the Australian Government wants to tax international retailers. Whether online retailers will start geoblocking Aussies will become clearer as July 1 approaches. In the meantime…