Netflix to up prices after GST change

  • 03/10/2016
Customers won't see a price change for another month (Reuters)
Customers won't see a price change for another month (Reuters)

Steaming video provider Netflix has confirmed its prices will go up to reflect the GST change for digital services that came into effect on Saturday.

The law change requires overseas retailers to be GST-registered and for them to return the tax to the Government, who said it was missing out on around $40 million a year.

Customers won't see a price change for another month, and new customers will pay the updated price when their initial 30-day free trial ends.

The company sent an email and in-product notification to customers, saying the price for its standard service will rise from $12.99 to $14.99.

The price for its basic service will go from $9.99 to $11.49, and its premium service will go from $15.99 to $18.49.

Several other online services have also upped their prices after the October 1 price hike, including some Google services, Skype and Adobe.

In a statement on Friday, Revenue Minister Michael Woodhouse said Inland Revenue had already received at least 75 "GST on remote services" registrants.

Offshore suppliers are required to register and return GST when their supplies to New Zealand residents exceed $60,000 in a 12-month period.

One of the biggest proponents of the law change was telco Spark, who said its Lightbox streaming service was competing on an uneven playing service to Netflix because the company didn't have to pay GST.

Netflix's price rise means its standard service now costs $2 more than Lightbox. Sky's Neon TV remains more expensive than both, at $20 a month.