60CElectronic marketplaces

1. Subsection (2) applies when—

2. a supply of goods, or a supply of remote services, or a supply of listed services is made through an electronic marketplace; and
3. for a supply of goods or a supply of remote services, in relation to a marketplace operated by a resident person, the underlying supplier is a non-resident person; and
5. the supply is of—
   1. remote services made to a person resident in New Zealand:
   2. goods made to a person involving delivery at a place in New Zealand:
   3. listed services performed, provided, or received in New Zealand.

6. The operator of the marketplace is treated as making, in the course or furtherance of a taxable activity, a supply to a person (the recipient) of—

7. remote services if the recipient is resident in New Zealand:
8. listed services if the services are performed, provided, or received in New Zealand:
9. items of goods, meeting the requirements of section 4B(1)(a) to (d) for distantly taxable goods, for which—
   1. the underlying supplier of the goods is a non-resident; and
   2. the operator or the underlying supplier makes or arranges or assists the delivery of the supply to the recipient at a place in New Zealand; and
   3. each item has an estimated customs value under section 10B equal to or less than the entry value threshold, if the operator has not made an election under section 10C that is effective at the time of the supply.

10. Subsection (2) does not apply to a supply if—

11. the documentation provided to the recipient identifies the supply as made by the underlying supplier and not the marketplace; and
12. the underlying supplier and the operator of the marketplace have agreed that the supplier is liable for the payment of tax; and
13. the marketplace does not—
    1. authorise the charge for the supply to the recipient:
    2. make or authorise the delivery of the supply to the recipient:
    3. directly or indirectly set a term or condition under which the supply is made.

14. Subsection (2) does not apply in relation to a supply of listed services provided through an electronic marketplace if—

15. the underlying supplier is a person, other than a person referred to in subsection (2BF), that meets the criteria—
    1. set out in a determination made by the Commissioner under subsection (2BC); or
    2. referred to in subsection (2BE); and
16. the documentation provided to the recipient identifies the supply as made by the underlying supplier and not the electronic marketplace; and
17. the underlying supplier and the operator of the electronic marketplace have agreed, recording their agreement in a document, that the underlying supplier is liable for the payment of tax in relation to the supplies of listed services and will continue to remain responsible for their tax obligations under this Act.

18. For the purposes of subsection (2BB), the Commissioner may determine the circumstances in which, and the criteria that a person must meet to enter into an opt-out agreement, having regard to the factors set out in subsection (2BD).

19. In making the determination under subsection (2BC), the Commissioner must have regard to—

20. the compliance costs that would arise for underlying suppliers in making changes to their accounting systems and practices; and
21. the size, scale, and nature of the services and activities undertaken by underlying suppliers.

22. Despite a determination made under subsection (2BC), a person who is an underlying supplier may enter into an agreement with the operator of the electronic marketplace if they have, or they are part of a group of companies under the Income Tax Act 2007 that has,—

23. 2,000 nights’ accommodation listed as available on 1 electronic marketplace in a 12-month period:
24. a reasonable expectation that they can meet the threshold in paragraph (a) for any 12-month period.

25. Subsection (2) does not apply to a supply of listed services provided through an electronic marketplace if—

26. the underlying supplier is a person, other than a natural person, that does not meet the requirement in section 15(2)(a) for a 6-month taxable period; and
27. they choose to be liable for the payment of tax in relation to the supply and will continue to remain responsible for their tax obligations under the Act; and
28. they have notified the marketplace operator of their election.

29. Subsection (2) does not apply to a supply of goods if—

30. the underlying supplier of the goods is a non-resident that has a branch in New Zealand; and
31. the operator of the marketplace treats the underlying supplier as a New Zealand resident in relation to the supply; and
32. in treating the underlying supplier as a New Zealand resident, the operator of the marketplace meets the requirements of section 60G(1) for information held by the operator relating to the residence of the underlying supplier.

33. If, in relation to a single supply of goods, remote services, or listed services, more than 1 operator of an electronic marketplace is liable for tax on the supply, the first operator that authorises a charge or receives consideration for the supply is treated as making the supply. If no operator exists that meets this requirement, the first operator that authorises delivery of the supply is treated as making the supply.

34. Subsection (3C) applies when—

35. an operator of an electronic marketplace is treated for the purposes of this Act as the supplier of remote services, distantly taxable goods, or listed services; and
36. the operator collects an amount from the underlying supplier or deducts an amount from the payment made by the recipient of the goods or services; and
37. the amount is used to meet the operator’s output tax liability for the supply.

38. To the extent of the operator’s output tax liability for the supply, the collection of the amount does not give rise to consideration for a supply for the purposes of this Act.

39. For the purposes of the electronic marketplace rules set out in section 152 of the Taxation (Annual Rates for 2022–23, Platform Economy, and Remedial Matters) Act 2023, the Commissioner may determine the circumstances and the criteria required for a person to enter into an opt-out agreement under those rules.

40. This section overrides section 60(1).