The retail giant said it would subject Australians to the process known as "geoblocking" from July 1, when a 10 percent Goods and Services Tax (GST) applies to imported online goods worth less than A$1,000 ($756).
"As a result of changes to Australian GST law on 1 July, global shopping options for Australian customers will change", a spokesperson for the online retail giant said.
Amazon.com Inc said on Thursday it will force Australians to use its Australian website instead of its much larger US site from July 1 to avoid a new sales tax on certain imported goods. Goods sold on Amazon.com, the United States site, will cease shipping to Australia on July 1. But taxes seem unlikely to protect brick-and-mortar shops from Amazon-.com or.com.au-in the long run.
The global store has more than four million items, however Amazon US has 480 million products.
New Zealand had also already applied GST to digital services from offshore, such as Netflix in 2016.
"I think it is disappointing that Amazon have taken this out on consumers in Australia but that is their commercial position", Mr Morrison said. Hundreds of thousands of customers will lose access to their ebooks on July 1st because Amazon does not allow customers to transfer Kindle purchases from one country to another.
The move, which attempts to level the playing field between local and global retailers, has posed issues to Amazon's worldwide selling scheme.
"The government doesn't apologize for ensuring multi-nationals pay a fair amount of tax here in Australia", a spokeswoman for Treasurer Scott Morrison said in an email.
The "Global Store" will offer some 4 million items, in addition to the 60 million products previously offered at Amazon.com.au, the spokesperson said.
A Productivity Commission inquiry concluded that given the decision to collect GST on low value imported goods, "the legislated model is the most feasible among the imperfect alternatives at this time". Local media reports that these store chains have heavily lobbied the government in recent years to extend the GST to online products sold by vendors situated overseas, to level the playing field.
In a statement about the change, Amazon said it regretted "any inconvenience this may cause customers".