Consumer NZ expects the Government to lower the threshold for paying GST when shopping online, despite concerns it will cost more to collect than it brings in.
At the moment, Kiwis buying things on the internet don't have to pay GST on purchases under $400. Australia's limit is $1000, but Treasurer Joe Hockey's pushing for it to come down to $20, if not zero.
Cabinet is expected to be presented with a paper this month looking at similar changes to New Zealand's GST threshold.
"The balancing act for us is always between the Government trying to have a level playing field and not massive inconvenience for the consumer," Prime Minister John Key said earlier this week.
"If Australia can get to a point where they can adequately complete the test of being fair but not dramatically inconveniencing consumers, then we should be able to do the same."
Appearing on the Paul Henry programme this morning, Consumer chief executive Sue Chetwin said she thinks the Government's already made up its mind.
"The Government will do it because it's actually being lobbied quite seriously by the retail group, and we will just have to foot it."
But even with the tax applied to online stores, it won't result in "nirvana" for retailers.
"Many people who are shopping online aren't shopping for price – they're shopping [online] because they can get more choice," says Ms Chetwin.
"Some people will say even if you added the 15 percent, they'd be paying a lot less than New Zealand retailers are charging."
The reason the threshold is currently $400 is that it isn't cost-effective to chase up GST on smaller purchases. But as more and more shopping moves online, Ms Chetwin says the calculations may soon change.
But there's still the problem of who is going to collect the GST, with thousands of different online stores from all around the world. One suggestion has been the banks and credit card companies, but Ms Chetwin says that will just push up costs for everyone.
"Not only are you paying 15 percent, you might be paying another 2 percent to have the cost of it actually being administered," she says.
Also, websites may already be charging their own local sales taxes and duties, and don't see why they should have to add another 15 percent on top of that for the benefit of a foreign government.
"There's quite a few things to work through before they'll actually be able to attach anything," says Ms Chetwin.
"It's going to be very costly."
The Government is confident it can get large multinational retailers like Apple on board, with the help of the OECD.
"The question is can you also deal... with a small company which sells T-shirts based in LA? That's a very different issue," Mr Key said on Monday.