E-commerce Taxation

The means and types of businesses have transformed with advent of era of e-commerce, resulting in global seller and buyer. The Internet offers consumer choice, business efficiency and recreation.

As a means of global communication it is so powerful in operation, yet so simple to use. Coupled by these benefit, there have emerged legal issues e.g. conflict of laws, consumer protection, securities and privacy, etc and to address these issues, we have to make amendments in substantive and procedural laws for providing legal framework for collection of taxes generated by e-commerce activities.

The tax statutes have provided us the details of sources of source of income but these vary according to the particular category of income in question. The critical question for electronic commerce taxation is how to analogize those transactions to the transactions in conventional commerce that are addressed in the tax statutes.

The determination of question of issue of territorial jurisdiction is also a crucial concern in e-commerce taxation. Rather the e-businesses which are falling in Pakistani tax jurisdiction for purposes of imposition of taxes or not.

The CBR can tax only Pakistani source of trade or business income of foreign individuals and corporations only when such income is attributable to a "fixed base" but the jurisdiction in cyber space is multi-dimensional, it could be at the residence of the seller or buyer or data encryption place. These are many tricky questions of jurisdiction which our existing tax statutes are ineffective to address them. We need here to make amendment in our tax statute for extension of Pakistani jurisdiction in cyberspace.

The record can be hosting at any jurisdiction, and application of retention and maintenance of record often arise legal issues which could only be solved according prevailing laws of the web hosting state. Legal issues arise when sellers or services providers choose to share the data with remote web server whose whereabouts is not known.

In current conditions, there is need for the CBR approval for keeping, maintenance, destruction and production of the storage of records electronically in prescribed manner and to have confidence in the processes and methodology used to store records electronically.

The CBR could simply retain the power to promulgate acceptable standards of electronic record keeping for tax purposes and to produce these records before court opens many legal questions. We don't have any extrinsic resources available for auditing, verifying and authenticating these records. Here we need reconstruction of statute for removal of inadequacy of tax laws. The booking requirement is useless unless the records are not accessed for the purposes of verification.

How to access the e-records hosted at a remote place? Rather the CBR have the administrative facility to access, verify, authenticate and provide the certified copies to court of law of these records. There are many advance devices with revenue authorities in advanced states like computer forensic, encryption and clipper chip for accessing these states but our tax statutes is silent on the establishment of these modern devices. What is recommended here that we should make these modern devices the part of tax statute for smooth and efficient running of tax administration.

Self-assessment relies on taxpayers voluntarily meeting their tax obligations. The self-assessment environment in the light of electronic commerce is causing the emergence of legal issues of compliance of tax return.

In e-commerce, deduction and location of the identity of persons behind the e-business is most crucial issues in tax compliance and electronic cash and e-money is accentuating existing problems. Here we need to redefine our tax statute in order to enhance the administrative requirement for meeting the statutory inadequacy.

The growing menace of tax evasion, mitigation and avoidance is too easy in electronic commerce technology and to curb this aggravating problem, the modern technologies are employed for the purpose of eliminating tendencies of avoidance but no anti-avoidance devices are used e.g. digital discovery authorities, computer forensic and surveillance authorities etc. These modern impartial authorities are often made part of the tax administration for the purpose of enhancing their efficiency and reducing tax avoidance.

We have legged behind in regulation of e-commerce taxation in the world. We need to reconstruct our tax statute at par with other countries within the framework defined by the UNICITRAL, the WTO, the OECD and the EU. UNICITRAL has provided the model laws for member states for avoidance of conflict of laws among them.

The writer is an advocate of High Court and practicing immigration and corporate laws in Pakistan since September 2001. He is a self employed and pioneer in research on electronic commerce taxation in Pakistan. His articles were published widely in the critical areas of cyber crimes, electronic commerce, e-taxation and various other topics. He wrote LL.M thesis on titled "Legislation of electronic commerce taxation in Pakistan" in which he provided comprehensive legal proposals for statutory reconstruction of tax laws for purpose of imposition of taxation on e-business in Pakistan. Currently he is conducting is research on topic 'Electronic commerce taxation: emerging legal issues of digital evidence'.

one time home cleaning Highland Park ..
In The News:

Privacy risks are hiding in plain sight, as your personal data is likely being collected, tracked, and sold without your knowledge.
VenHub, a fully autonomous, AI-powered smart store just opened at the LAX/Metro Transit Center in Los Angeles.
A woman's Facebook account takeover reveals dangerous social engineering tactics and provides lessons on recovery, avoiding scams and enacting stronger security measures.
Shanghai engineers are using 432 walking robots to relocate a complex, preserving Shikumen architecture while creating space for a modern underground hub and cultural center.
Major healthcare data analytics firm Episource had a cybersecurity incident exposing 5 million patients' medical records and personal information in recent breach.
A new sophisticated PayPal scam sends legitimate-looking emails from official PayPal addresses, using phone numbers instead of links to convince victims to download remote access tools.
Fox News' AI Newsletter brings you the latest on this rapidly evolving technology.
The innovative Kara Pod device extracts moisture from air to create mineral-rich water and brew coffee, featuring UV sterilization and compatibility with Nespresso pods.
Gov. Hochul unveiled New York's nuclear power plant project to power a million homes, which faces permit challenges while promising jobs and a cleaner energy future.
SAFE introduces Aerie, an underground luxury bunker combining high-end living with advanced security, wellness amenities and interactive walls simulating panoramic views.
A Facebook scammer posing as Elon Musk tricked a victim with promises of a Tesla and $250,000, requesting gift cards that become untraceable once the codes are shared.
Experience hands-free golfing with the Robera Neo smart caddie that uses AI to follow you, navigate obstacles and carry your clubs with GPS course mapping.
Cybersecurity alert: 16 billion passwords exposed in massive credential database affecting major platforms. Protect your accounts with password managers
The innovative BeBot robot uses electric power to remove pollution from shorelines, covering 20-30 times more area than manual collection while preserving wildlife.
A new ClickFix campaign targets macOS users with fake Spectrum support sites, tricking victims with CAPTCHA failures to paste commands that install information-stealing malware.
AI-powered autonomous trucks from Plus Automation are being tested across the U.S., Europe and Asia to solve logistics challenges while facing regulatory hurdles and labor concerns.
Your health information might feel private and secure with your doctor, but the reality is far more complicated. Data brokers collect a wide range of sensitive health data, from diagnoses and prescription details to personal identifiers, and sell this data to marketers, insurers, and other third parties.
Kepler Robotics has officially introduced its Forerunner K2 "Bumblebee" humanoid robot at the SAIC-GM automotive plant in Shanghai, marking a significant moment in the real-world deployment of advanced robotics.
Scammers never seem to be running out of new ways to try and get their hands on your money – and lately, they've been getting sophisticated.
Thirty people were injured and killed, though the exact number remains currently unknown, when a suicide bomber blew himself up in a Damascus church.
Unexpected password reset alerts signal potential hacking attempts or phishing scams. Learn how to respond and establish stronger security measures for your accounts.
A historic electric airplane flight landed at JFK with passengers, marking a milestone as Beta Technologies demonstrates the practicality and efficiency of electric air travel.
The Chaos ransomware group breached Optima Tax Relief in a double-extortion attack, stealing sensitive customer case files and corporate documents with personal information.
Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.
The first human brain-computer interface by Paradromics was completed in 20 minutes, featuring microelectrodes to help paralyzed individuals control computers with thoughts.

Take Control of Your Taxes

As everyone in the U.S. knows, we have just passed... Read More

Need an Offshore Sales Office in a Tax Free Environment?

The 100 year old investment-banking firm of... Read More

Tax Trap #4 -- The Quagmire of Depreciation

If you are a Small Business Owner or Self-Employed Person,... Read More

IRS Reports Tax Gap of $300 Billion

The Internal Revenue Service is reporting that the difference between... Read More

Tax Jokes and Quotes

Do you realize that some tax forms ask you to... Read More

Identity Theft ? Impacting Your Taxes?

If your identity is stolen, your finances can quickly become... Read More

Small Business Tax Deductions for Year End 2004

As a small business owner, it's wise to familiarize yourself... Read More

Tips and Simple Guidelines on How to Calculate Payroll Taxes

Managing a business small, medium or big requires you to... Read More

How Home-Based Businesses Can Avoid Giving Uncle Sam More than His Share

How Home-Based Businesses Can Avoid Giving Uncle Sam... Read More

How to Check the Status of Your Tax Refund Online

So, you were pleasantly surprised to learn that you are... Read More

Seven Key Tax Deductions for the Self Employed

As a sole proprietor, it's wise to familiarize yourself with... Read More

Home Business Tax Tips

If you have recently started an Internet or home business,... Read More

Tax Time Tune Up

Excerpted from the new book, "How to Do Space Age... Read More

Fiscal Deity: Tax Consultant

Strategic planning throughout the year results in a minimal tax... Read More

IRS Certifies 2006 Toyota Hybrid for Clean Fuel Deduction

The Internal Revenue Service has certified the 2006 Toyota Highlander... Read More

The Implications of Income Tax Charge on Estate Planning

OverviewIn the Pre-Budget Report of December 2003 the Chancellor Gordon... Read More

Deducting Points On Home Refinances

Deduction of Refinance PointsAny points that you pay in the... Read More

Another Tax Loophole

Just image, you are a small manufacturing company, business has... Read More

SFR Substitute for Returns: IRS Action on Non-Filers

In the latest Star Wars episode, the evil empire executes... Read More

Access to E-records by Taxing Authorities: A Case for Pakistan (Part I)

Background issues of access to recordsTo assess the records at... Read More

Need a Copy of Your Tax Return Information?

Taxpayers have two easy and convenient options for getting copies... Read More

Tax Tips for Home-Based Business Owners

As tax time approaches, many home-based business owners begin completing... Read More

Employment Taxes ? What Are They?

If you have employees, you are responsible for paying a... Read More

Know A Tax Cheat? Get Paid To Tell The IRS

According to the IRS, taxpayers underpay their taxes by some... Read More

Military Reservists, Enlistees May Get Deferral of Back Taxes

Reservists called to active duty and enlistees in the armed... Read More

licensed cleaning services Park Ridge ..