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Tax on e-commerce?

Updated: Mar 15, 2023

It is essential to adapt tax legislation to apply the tax to e-commerce.

E-commerce worldwide has seen rapid and sustained development, which has led governments and multilateral bodies to accelerate their regulatory proposals to develop a legal framework to raise tax revenues on online purchases. At the meeting of the Ad Hoc Expert Group on E-commerce and Taxation organised by the United Nations Conference on Trade and Development (UNCTAD), held on 7 and 8 June 2022, the challenges posed by e-commerce taxation of new digital business models, especially indirect taxation of e-commerce, were analysed.

The taxation of business-to-consumer (B2C) business models and the need to adapt taxation to domestic and cross-border business models was discussed, due to the simplicity and effectiveness it would imply for implementation in some developing countries.

The main challenges and opportunities for the tax systems of these countries as a result of indirect taxation of e-commerce on the basis of best practices and the most important factors in the design of tax policy were also discussed.

The expert group considered that due to the current situation of public finances, in most states, it is essential to adapt the basic legislation of Value Added Tax or similar taxes, such as the Tax on the Transfer of Material Goods and Services (Itbms), in "B2C" business models of cross-border goods.


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