Games purchased on Steam will be subject to GST from next October, Revenue Minister Todd McClay says.

As reported by Stuff, from October 1, a GST charge of 15 per cent will be added to Netflix subscriptions, iTunes downloads, Amazon e-books, and other digital products and services purchased offshore.

Any foreign company that sells more than NZS$60,000 of digital services to New Zealanders each year will be required to register with Inland Revenue and collect the GST on its behalf.

Those avoiding GST by using a VPN to make it appear they lived outside the country would be liable for a fine of up to $25,000, said McClay. It will be up to the IRD to implement the rules.

However, those circumventing geo-blocking to access content would probably not be liable for fines, said Deloitte tax partner Allan Bullot.

The tax is designed to close a loophole under which digital products and services can be bought from overseas firms tax free. It is expected to raise about NZ$40 million a year for the government.

The Government first announced its plans to impose the so-called "Netflix tax" in August.

Several countries, including South Africa, Norway and Japan, have introduced similar regimes to that proposed by the new legislation, with Australia set to follow in July 2017.