The ab study ract discusses the important concepts woven around the idea of e tailing and taxation policy measures and aims at coming up with a conclusion which will help further to determine the appropriate tax policies for e retailers keeping in mind the global framework. Loss of revenue and erosion of the tax base 175 chapter 8 international cooperation and initiatives 201 chapter 9 emerging tax policy 243. Global taxation of cross border ecommerce income ssrn. Neutrality taxation should seek to be neutral and equitable between forms of ecommerce and between conventional and ecommerce, so avoid ing double taxation or unintentional nontaxation. It analyses a number of trends in the behaviour of national taxation authorities, webbased companies, certain low tax jurisdictions and international organisations. Contents list of figures and tables vi preface vii acknowledgements ix chapter 1 internet and ecommerce 1 chapter 2 international taxation. Issues, approaches and solutions in taxation of electronic. The levy of income tax in india is governed by the income tax act, 1961 and income tax rules, 1962. Browse our product catalogue and lecturer resources. Turkey from a legal perspective, it creates problems in the international delivery of goods and services performances. The benefit principle is a concept in the theory of taxation from public finance.
Nexus requirements for taxation of nonresidents business. Taxation and developing countries training notes september 20. It is trite, but true, that taxation of ecommerce is a major concern for international agencies and tax authorities worldwide. China increases taxes on crossborder ecommerce retail. Ecommerce makes international trade in particular so much easier, and so the debate about taxation moves up the international level, too. What are the administrative challenges of taxing ecommerce, and. There are five perspectives used to defined ecommerce which is business process, services, learning, collaborative and community. Taxation and electronic commerce implementing the ottawa taxation framework conditions implementing the ottawa taxation framework conditions how should governments tax ecommerce.
Tax challenges are only one aspect of the difficulties faced while regulating the internet and gaining jurisdiction to set rules, to judge, and to enforce laws. So taxation of ecommerce is a normal part of the accepted pattern of how our. Taxing authorities may have great difficulty collecting revenue. The article argues for the imposition of a global ecommerce tax on cross border ecommerce income and designs the details of the tax. Giving learners equal access to the information and tools they need at no extra cost gives them the best opportunity to engage and progress.
Subhajit basus new book global perspectives on ecommerce taxation law. The current dearth of neutrality and basic fairness in ecommerce taxation legislation will become more painfully perceptible at the heart of the debate is the principle that states and other local governments have the right to tax goods sold within their. Taxing ecommerce is a global challenge for governments and business alike. The evolution of sales use tax policy in the ecommerce era. We discuss the arguments for the destination principle as the appropriate placeof taxation rule for. This volume examines the implications of the growth of ecommerce for national and international tax systems. Citi perspectives citi perspectives autumn 2016 04 perspectives for 2017. It presents an exploratory study of two fundamental taxation principles that apply to international transactions in general and, more specifically, to ecommerce. In conclusion, electronic commerce as known as ecommerce is used to buy, sell, transfer or exchange products, services and information via computer network and internet.
With its focus on the broader issues surrounding the expansion of ecommerce and its attention to the problems arising internationally in this field, global perspectives in ecommerce taxation law. This essential guide addresses the latest developments in tax ecommerce transactions in key jurisdictions. It is often considered to be a branch of civil law and deals both with issues of private law and public law. Selected tax policy implications of global electronic commerce ii this paper provides an introduction to certain federal income tax policy and. Difficulties like uncertainty and double taxation make parties of ecommerce reluctant and affect development of ecommerce negatively. It should be read together with the income tax act 1967 ita 1967, other relevant legislations and legal procedures currently in place. As the internet crosses the boundaries the main challenges are how can the basic requirements of physical presence and substantial nexus criteria of taxation can be met. Given our international economy, global perspectives on income taxation law is an insightful resource for those teaching a basic income tax course or a tax policy seminar. At one extreme, there was the view that ecommerce should in some sense. Apr 11, 2019 how to adjust to new sales tax laws for ecommerce along with the obvious changes that are going to need to be implemented from an accounting perspective. The challenges that ecommerce poses to international tax. What does ecommerce mean for existing international tax principles and systems. Global perspectives on ecommerce taxation law subhajit. There is little in the way of new rules or new laws to address the proper taxation of ecommerce.
Perhaps the most significant feature of this emerging body of law is that it is necessarily transnational, as ecommerce cannot be contained within national borders. Global perspectives on ecommerce taxation law by subhajit basu, 9780754647317, available at book depository with free delivery worldwide. Ecommerce occurs in various forms and between various entities in the market. One among the question faced by nations is how to tax it. International tax issues in the area of ecommerce are manifold and include nexus of the vendor and tax enforcement agencies. On 24 march 2016, the china ministry of finance, together with the general administration of customs and the state administration of taxation, announced in a new circular, cai guan shui 2016 no. Overview of indirect tax laws key segmentwise issues from the perspective of regulatory, direct tax, indirect tax and transfer pricing 1.
The role of taxation problems on the development of ecommerce. Student company secretary as well as other law professional journals on tax laws. Certain legal and practical problems, particularly in. This difference has tax ramifications as the global or virtual component of the ecommerce increases, the tax challenges become more profound. The technology that makes ecommerce what it is puts more of a spotlight on the possible challenges to effective taxation just how do you tax a cyberbusiness, or all those sales over the net. The evolution of salesuse tax policy in the ecommerce era challenges facing remote sellers. Jan 01, 2007 this volume examines the implications of the growth of ecommerce for national and international tax systems. While some use ecommerce and ebusiness interchangeably, they are distinct concepts. Global perspectives on ecommerce taxation law subhajit basu queen s university belfast, uk ashgate. The internet tax freedom act itfa2 imposed a three. Formulating international tax laws in the age of electronic commerce. In this concluding part of the series of the discussion note on evolution of e.
Tax a financial charge or other levy imposed on a taxpayer an individual or legal entity by a state, or the functional equivalent of a state, such that failure to pay is punishable by law. With its focus on the broader issues surrounding the expansion of ecommerce and its attention to the problems arising internationally in this field, global perspectives in ecommerce taxation law will appeal to scholars worldwide. Generally speaking, ecommerce in tangibles is less global and less virtual than ecommerce in intangibles, and ecommerce in services lies somewhere in between. Overview of income tax on corporate income a resident company is taxed on its global income. The digitalization of the economy is considered as a key driver of innovation, economic growth and societal change, and is a major challenge for the international tax system.
It covers a wide variety of activities, from discussion of the principles governing direct and indirect taxation, to explanation of the implementation and use of ecommerce on the part of businesses as well as the application of existing tax principles in this field. This book contains a critical evaluation of the nexus requirements for the taxation of nonresidents business income enshrined in the current rules of international tax law and provides a proposal that is more aligned with international tax policy benchmarks. Ecommerce, still in its infancy, is not currently a major economic force but in all likelihood, will become the future of international commerce. Valueadded tax, duties and regulations that vary from one country to the next all. From the taxation perspective this type of ecommerce is the simplest to handle because it mirrors the situation in real space and is amenable to existing laws. In its most advanced form ecommerce allows unidentified purchasers to pay obscure vendors, in electronic cash, for products that are often goods, services, and licenses all rolled into one.
Global perspectives on ecommerce taxation law 1st edition. Nevertheless, treasury believes that these new technologies should not be used to justify new taxes. However, opponents of ecommerce taxing will continue to argue that. From that of the seller, it is a tax only on the value added to a product, material. Issues in international taxation 1 abstract the purpose of this paper is to offer a compilation and synthesis of selected commentary addressing the issues and discussions concerning the international taxation of the phenomena known as ecommerce. Recent developments in state taxation of online sales. Commercial law sometimes known as business law is the body of law which governs business and commerce. As the internet has crossed borders sovereignty how can the requirements of physical presence and substantial nexus criteria of taxation be met. The global initiative of ecommerce taxation will be dealt with in detail. Taxation of ecommerce transactions kpmg united states. We specialize in strategic legal, regulatory and tax advice coupled with industry expertise in an integrated manner. A guide to the law of electronic business 1999 at 257. The contributors, local tax practitioners with indepth knowledge of their jurisdictions regulations, offer useful insight on what the future may hold for ebusiness taxation around the world.
In ecommerce, information and communications technology ict is used in. As with many other areas of the law, the tax code must evolve with the technological advances of the business world and, as the law catches up, businesses must be prepared to understand and comply with the new. Selected tax policy implications of global electronic commerce. Basus text is a must to any lawyer or tax expert who wishes to gain entry to this difficult and complex area. Security, privacy, censorship and taxation also play a role. The principle is sometimes likened to the function of prices in allocating private goods. E commerce can be defined from five perspectives information. It bases taxes to pay for publicgoods expenditures on a politicallyrevealed willingness to pay for benefits received. The purpose of this study material is to impart conceptual understanding to the students of the provisions of the direct tax laws income tax and wealth tax and indirect tax laws service tax, value added tax and central sales tax covered in the syllabus. The concrete tax rules applying specifically to the direct taxation of ecommerce is few.
In india, direct tax is governed by the income tax act, 1961 the act, along with the income tax rules, 1962 the rules. Perspective part 1 annet wanyana oguttu university of south africa 1 introduction faced with high rates of tax in their countries of residence, taxpayers involved in international trade are increasingly developing global tax. Richard jones, liverpool john moores university, uk comprehensive, cutting edge, and illuminating accurately describe dr. Global perspectives on ecommerce taxation law taylor. Chapter 4 the relevance of ecommerce for taxation 81 chapter 5 direct taxation and ecommerce 107 chapter 6 the effect of ecommerce on consumption taxes 141 chapter 7 ecommerce. The same principles that governments apply to taxation of conventional commerce should equally apply to ecommerce, namely. International taxation of electronic commerce income. Taxation of ecommerce is an important issue for countries, businesses and consumers who want to be a party of ecommerce. By country, technology, regulations, laws, cultures social issues, economics, vendors, competitors and consumers all have an impact on the use of the internet. The tax that is levied directly on the income or wealth of a person is called direct tax. Find all the books, read about the author, and more.
Rapid growth in ecommerce has altered the ability of jurisdictions to enforce commodity taxes on a destination basis. The challenges that ecommerce poses to international tax laws. Taxation of ecommerce transactions the national assembly of vietnam in june 2019 passed a new tax administration law one that may affect many nonresident enterprises selling goods and services into vietnam via digital and ecommerce business models. Unimaginable depth and breadth, unprecedented mobility and flexibility. The development of electronic commerce herein after referred to as ec can be said to be the greatest event in the history of mankind, next only to the industrial revolution of the early 20th century. In doing so, and since the mandate of the tag invited it to examine these characterisation issues with a view to providing the necessary clarifications in the commentary, the working party is. This book considers the implications for the domestic and international tax systems of the growth of e commerce. In its most advanced form, ecommerce allows unidentified purchasers to pay obscure vendors in electronic cash for products that are often. Taxation for ecommerce a global perspective written by. Global perspectives on ecommerce taxation law and millions of other books are available for amazon kindle.
Taxation of ecommerce transactions, remote digital sales vietnam. Ecommerce taxation in national and international area. This discussion concludes that the right answer to the challenges was not given so far and the need for a different response is essential in the age of ecommerce. We discuss the arguments for the destination principle as the appropriate placeof taxation. The issues such as tax loss and tax evasion are crucial in terms of countries. From the perspective of the buyer, it is a tax on the purchase price. The comparative perspective provides a thoughtprovoking look at the tax policy choices made by australia, brazil, israel, various european countries, and the united states. This paper will first describe the phenomenal growth of ecommerce transactions in india and the general initiatives taken by the government to boost the ecommerce transaction. Interview with simon woodside, fiscal affairs at oecd. Selected tax policy implications of global electronic commerce department of the treasury office of tax policy november 1996. Global perspectives on ecommerce taxation law 97818247079. After extensive searches electronically and through more traditional.
Although there is a general consensus that what holds off line, holds on line, there are circumstances that give rise to legal issues peculiar to the information technology. This results in different effective tax rates depending on the way in which goods and services are purchased and the characteristics of both the products and the sellers. In its most advanced form, e commerce allows unidentified purchasers to pay obscure vendors in electronic cash for products that are often goods, services and licenses all rolled into one. Implementing ecommerce tax policy harvard journal of law. Direct taxation 29 chapter 3 international taxation.
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