Australia Tax is a phrase applied to the generally higher prices in Australia of goods and services than equivalent costs in comparative overseas nations such as the United States. This is particularly the case for video games, [1] computer hardware, and software but may extend to non-technological items such as cars, designer clothing and banking services. [2] [3] Companies selling non-physical products which are not subject to the rent and labour of a traditional retail outlet have been particularly criticised. [4] Some prices differences can be as much as 88%. [5]
The phrase was first used by Ed Husic, a federal member of parliament, who brought the issue up in the chamber and subsequently advocated for an inquiry into the problem. [6] The cost of digital goods was the subject of an inquiry by the Australian government in 2013. [7]
In 2013, the cost of Adobe Systems' Creative Suite 6 Master Collection in Australia was much higher than that of the United States equivalent, retailing at AU$4,334 in comparison to US$2,599 in the United States (at that time, Australian dollar was almost on a par with U. S. dollar [8] ). It was calculated at the time that it was cheaper to fly to the United States, purchase a copy of the software, and fly back to Australia. [9] In May 2013, the Adobe Creative Cloud service was launched, offering access to the Creative Suite software on a subscription basis. Australian prices initially were set to AU$62.99 per month in comparison to the United States price of US$49.99 per month, but following an inquiry by the Australian government into regional pricing of digitally distributed goods, Adobe Systems adjusted the Australian price to match that of the United States. [10]
Microsoft was criticised by a report released by the Australian Standing Committee on Infrastructure and Communications titled "At what cost? IT pricing and the Australia tax." The report acknowledged that there were some contributing factors specific to the Australian market which can make it a higher-cost environment for IT vendors compared with other markets, such as Australia's small population and geographical distribution, [11] however the inquiry did not find that these factors were substantial enough to defend the price increases of products such as Microsoft Office, especially if the product is delivered via the Internet. [12]
In 2012, the House of Representatives Standing Committee on Infrastructure and Communication began a 12-month investigation into price differences for IT products. [13] The report, mentioned in the preceding section, concluded that IT products are more expensive in Australia because of "regional pricing strategies implemented by major vendors and copyright holders". Ten recommendations were made including the removal of geo-blocking restrictions and lifting restrictions on parallel importing. [13] An amendment to the Competition and Consumer Act, which would make contracts or terms of service which seek to enforce geo-blocking become void, was suggested, as was the education of the Australian public on ways to circumvent geo-blocking mechanisms. The recommendations were supported by the Australian consumer rights organisation, Choice. [14]
Purchasing power parity (PPP) is a measure of the price of specific goods in different countries and is used to compare the absolute purchasing power of the countries' currencies. PPP is effectively the ratio of the price of a basket of goods at one location divided by the price of the basket of goods at a different location. The PPP inflation and exchange rate may differ from the market exchange rate because of tariffs, and other transaction costs.
A price is the quantity of payment or compensation expected, required, or given by one party to another in return for goods or services. In some situations, especially when the product is a service rather than a physical good, the price for the service may be called something else such as "rent" or "tuition". Prices are influenced by production costs, supply of the desired product, and demand for the product. A price may be determined by a monopolist or may be imposed on the firm by market conditions.
A variety store is a retail store that sells general merchandise, such as apparel, auto parts, dry goods, toys, hardware, furniture, and a selection of groceries. It usually sells them at discounted prices, sometimes at one or several fixed price points, such as one dollar, or historically, five and ten cents. Variety stores, as a category, are different from general merchandise superstores, hypermarkets, warehouse clubs, grocery stores, or department stores.
The Australian Competition and Consumer Commission (ACCC) is the chief competition regulator of the Government of Australia, located within the Department of the Treasury. It was established in 1995 with the amalgamation of the Australian Trade Practices Commission and the Prices Surveillance Authority to administer the Trade Practices Act 1974, which was renamed the Competition and Consumer Act 2010 on 1 January 2011. The ACCC's mandate is to protect consumer rights and business rights and obligations, to perform industry regulation and price monitoring, and to prevent illegal anti-competitive behaviour.
Criticism of Microsoft has followed various aspects of its products and business practices. Issues with ease of use, robustness, and security of the company's software are common targets for critics. In the 2000s, a number of malware mishaps targeted security flaws in Windows and other products. Microsoft was also accused of locking vendors and consumers in to their products, and of not following or complying with existing standards in its software. Total cost of ownership comparisons between Linux and Microsoft Windows are a continuous point of debate.
Rip-off Britain is an expression used by some to refer to the phenomenon in which some products and services cost significantly more in the United Kingdom than in other countries, especially member states of the European Union and the United States, than a basic currency conversion would permit.
A netbook is a small and inexpensive laptop designed primarily as a means of accessing the Internet. Netbooks were sold from 2007 until around 2013, when the widespread advent of smartphones and tablets eclipsed their popularity.
Border trade, in general, refers to the flow of goods and services across the border between different jurisdictions. In this sense, border trade is a part of the normal trade that flows through the ordinary export/import legal and logistical frameworks of nations and smaller jurisdictions. However border trade specifically refers to the increase in trade in areas where crossing borders is relatively easy and where products are significantly less expensive on one side of the border than the other – often because of significant variations in taxation levels on goods. Common items involved in border trade include alcohol, tobacco, medication, recreational drugs, automobiles, automotive fuel, groceries, furniture and clothing.
A parallel import is a non-counterfeit product imported from another country without the permission of the intellectual property owner. Parallel imports are often referred to as grey product and are implicated in issues of international trade, and intellectual property.
The law of one price (LOOP) states that in the absence of trade frictions, and under conditions of free competition and price flexibility, identical goods sold in different locations must sell for the same price when prices are expressed in a common currency. This law is derived from the assumption of the inevitable elimination of all arbitrage.
Harvey Norman is an Australian multinational retailer of furniture, bedding, computers, communications and consumer electrical products. It mainly operates as a franchise, with the main brand and all company-operated stores owned by ASX-listed Harvey Norman Holdings Limited. As of 2022, there are 304 company-owned and franchised stores in Australia, New Zealand, Europe and South-East Asia operating under the Harvey Norman, Domayne and Joyce Mayne brands in Australia, and under the Harvey Norman brand overseas.
Dynamic pricing, also referred to as surge pricing, demand pricing, or time-based pricing, is a revenue management pricing strategy in which businesses set flexible prices for products or services based on current market demands. It usually entails raising prices during periods of peak demand and lowering prices during periods of low demand.
The bundling of Microsoft Windows is the installation of Microsoft Windows in computers before their purchase. Microsoft encourages original equipment manufacturers (OEMs) of personal computers to include Windows licenses with their products, and agreements between Microsoft and OEMs have undergone antitrust scrutiny. Users opposed to the bundling of Microsoft Windows, including Linux users, have sought refunds for Windows licenses, arguing that the Windows end-user license agreement entitles them to return unused Windows licenses for a cash refund. Although some customers have successfully obtained payments, others have been less successful.
The Australian property bubble is the economic theory that the Australian property market has become or is becoming significantly overpriced and due for a significant downturn. Since the early 2010s, various commentators, including one Treasury official, have claimed the Australian property market is in a significant bubble.
Kogan.com is an Australian portfolio of retail and services businesses including Kogan Retail, Kogan Marketplace, Kogan Mobile, Kogan Internet, Kogan Insurance, Kogan Travel, Kogan Money, Kogan Cars, Kogan Energy, Dick Smith, Matt Blatt and Mighty Ape. The company was founded in 2006 by Ruslan Kogan.
Stephen Elop is a Canadian businessman who most recently worked at Australian telecom company Telstra from April 2016. In the past he had worked for Nokia as its first non-Finnish CEO and later as Executive Vice President, Devices & Services, as well as the head of the Microsoft Business Division, as the COO of Juniper Networks, as the president of worldwide field operations at Adobe Systems, in several senior positions in Macromedia and as the CIO at Boston Chicken.
Inflation rate in India was 5.5% as of May 2019, as per the Indian Ministry of Statistics and Programme Implementation. This represents a modest reduction from the previous annual figure of 9.6% for June 2011. Inflation rates in India are usually quoted as changes in the Wholesale Price Index (WPI), for all commodities.
Adobe Creative Cloud is a set of applications and services from Adobe that gives subscribers access to a collection of software used for graphic design, video editing, web development, photography, along with a set of mobile applications and also some optional cloud services. In Creative Cloud, a monthly or annual subscription service is delivered over the Internet. Software from Creative Cloud is downloaded from the Internet, installed directly on a local computer and used as long as the subscription remains valid. Online updates and multiple languages are included in the CC subscription. Creative Cloud was initially hosted on Amazon Web Services, but a new agreement with Microsoft has the software, beginning with the 2017 version, hosted on Microsoft Azure.
The pink tax refers to the tendency for products marketed specifically toward women to be more expensive than those marketed toward men. This phenomenon is often attributed to gender-based price discrimination, however research shows that the primary cause is women sorting into goods with higher marginal costs. The name stems from the observation that many of the affected products are pink.
Zero Day Initiative (ZDI) is an international software vulnerability initiative that was started in 2005 by TippingPoint, a division of 3Com. The program was acquired by Trend Micro as a part of the HP TippingPoint acquisition in 2015.
