Taxing E-Commerce

Abstract

With the advent of globalization, world governments have been under pressure to face the significant challenges of e-commerce. The vast growth of e-commerce, sale and purchase of commodities over the internet, has ruined the existing tax structure. With the smart phones and internet getting cheaper, the tax administration of every country is facing the difficulty of protecting their share of revenue in this dynamic e-market. The tussle between the developed and developing country is going to stretch as it would be an alarming signal for the reduction of the tax base for the developing economy. E-commerce challenges the current International taxation regime. In the present scenario, personal income tax is being taxed by the resident country while business income is being taxed by the source country.