The great Aussie gouge

By Nila Sweeney

There’s a reason why Australians take shopping holidays to other parts of the world – because just about everything is cheaper anywhere else.

A pair of Nike running shoes cost $240 at a major Australian sports retailer, while in the US the same product could be bought for $134 from an online website based in Asia.
And the price for Portal 2, a popular video game for Xbox 360 and PlayStation 3, costs 91% more from a major Australian online retailer than online.

The dollar is getting stronger, but Aussies are still paying more - A consumer watchdog is accusing retailers of failing to pass on savings from the high Aussie dollar to shoppers.

“There are too many examples from white goods to motorcycles and TV’s to video games where we pay more. It’s up to those in the supply chain here in Australia to justify why this is the case. Importers and retailers should not cry foul if consumers chase better prices, wherever they may be,” says Choice director of campaigns and communications, Christopher Zinn.

In a submission made today to the Productivity Commission’s retail inquiry, Choice stated the pricing disparities between many goods sold in Australian stores and those purchased online from overseas are significant and economically unjustifiable.


According to the consumer group, there is no justification in changing the present GST-free threshold of $1000 for online shoppers so that Australia retailers are protected from overseas online retail competition.

Choice says it is a “pipe dream” for local retailers to think the imposition of a GST on overseas purchases will suddenly make the threat go away, and argues the benefits of overseas offerings, including better prices, service and range; outweigh any disincentive a 10% levy may create.

“The pressure from overseas online competition is a much needed wake up for Australian retailers to be more competitive. We need to move beyond a complacent culture of high prices, high margins and poor service,” Zinn says.

Even though parallel importing is legal for most products, Choice says companies can use technological methods such as banning international IP addresses and credit card numbers as well as pushing consumers to ‘local’ websites.  This creates barriers for consumers wanting cheaper items over the internet.

“We are challenging global corporations to drop the artificial technological barriers used to block competitive prices online, such as those affecting software and music downloads,” he adds.
A cost comparison of the top 12 music albums reveals that on average Aussies pay 73% more on the Australian iTunes than the US iTunes store.