Adminstration of E-Business Taxation

The entry by telephone and cable companies into the Internet service provider business within the last few years has given new hope to the congestion problem in that they now have a vested interest in investing in infrastructure. The Internet connection and set-up cost are not inexpensive for every business; however, the competitive cost of not having it probably outweighs the financial cost of connectivity. Even if businesses deal with customers that are domestic or local, reaching the customer is only one aspect of the Internet. It can be used to communicate with suppliers to build supply networks, order materials, sales or other information 24 hours a day, 7 days per week.

Selling on World Wide Web Prior to the contract: The customer enters the merchants web site, views the product and company information and if the vendor and the buyer have established a mechanism that neither of them should be able to repudiate the offer price or the products ordered, and If the customer is convinced that the product will arrive at an approximate specified delivery time, and If the vendor is satisfied that it will be paid Then, the customer will place an order. Settlement of the amount due: the vendor invoices, the customer authorizes/pays.

The post sales warranty, support and customer data gathering there is some debate regarding the formation of an electronic contract over the Internet. One of the differences between contracting over the Internet and contracting by any other electronic means is the on-line Internet Service Provider. The issue is whether the parties are communicating and contracting directly or are they communicating and contracting through a third party. Under the acceptance rule a contract will not be formed until acceptance of the offer by the offeree has been communicated to the offeror. The exception to the rule is called the postal rule, where an offeror or has explicitly or implicitly agreed to the offer being accepted by the post office, once the letter or other communication has been posted. The contract is deemed to have been formed even if the offeror does not receive the letter accepting the offer. In building the web site documentation, it should be made clear in the relevant terms and conditions or by a statement that will be seen by the user before sending their request by email to purchase an item,

Administration of Sales Tax and Central Excise duties

One challenge is presented by continued growth in the volume of Internet sales. To what extent that such growth occurs, it increases remote sales where compliance is already most problematic. Another challenge is that the expanding variety of e-commerce transactions and products may create new types of compliance problems, such as identifying the location and nature of a sale. Although the future growth rate of Internet sales is not known, certain characteristics favor the rapid growth of Internet sales. For example, Commerce has reported that e-commerce not only reduces the cost and time of doing business but also provides alternative shopping sites, expands existing markets, and creates new markets. E-commerce also frees some sellers from the "geographic confines and the costs of running actual stores." These characteristics have the potential to increase the number of remote sellers and purchasers as well as increase the volume of remote sales. To the extent that such sales growth occurs, it will magnify the existing sales and central excise duties compliance problems associated with remote sales, such as the difficulty of enforcing compliance by purchasers in the case of remote sales without nexus. The expanding variety of electronic transactions may also create new compliance challenges. Shifts from traditional forms of sales to Internet sales can make it more difficult to identify the location of the buyer and the seller, the status (business, individual, other) of the buyer or seller, and the nature of the product itself.

In terms of the location, both sellers and purchasers may have multiple locations, and the Internet makes it easier for these firms to conduct their transactions from the location that offers the greatest tax advantages. Businesses may also choose to establish a presence in certain jurisdictions in order to maximize these advantages. As a result, determining the location of buyers and the sellers' activities for nexus purposes, which is important for the collection of sales and central excise duties is more difficult in an environment with Internet sales. A related challenge for the collection of sales and central excise is determining the status of the buyer and seller in Internet transactions. The status of the seller, for example, is relevant since certain sales by individuals are not subject to sales and central excise duties. However, the development of new markets, such as Internet auctions, has created a new opportunity for businesses as well as individuals to avoid sales and central excise duties. To the extent that businesses are using these new markets to make sales, it would be necessary for tax authorities to be able to identify those sellers as businesses rather than as individuals in order to assess the appropriate taxes. Need for legislation The Internet, as we know it today, is no longer a medium limited to nerds and geeks in science labs. It has become a whole new way of life. We have started identifying ourselves with this medium to such an extent that nowadays we take a net connection for granted.

Electronic mail, surfing the World Wide Web, browsing through search engines for that elusive piece of info have all nowadays been woven into the fabric of daily life. In face of this media juggernaut, little do we realize how close we are to being robbed of our credit card numbers by that smart programmer down the road, or that we might be under surveillance with some body stalking our movements on the net or simply still, some body gaining unauthorized access to all the private information on our computers wrecking havoc in our private lives. The era of the Net Economy has also bought with it new approaches to success in business. The Internet and the Web are creating a new economic order-one where people and businesses can exchange information, goods, and services at the speed of light. Many smart companies are rapidly gaining competitive advantage by leveraging the business benefits of these web-based connections, and succeeding in new economic relationships. Today businesses large and small face an unprecedented set of challenges-and an unparalleled set of opportunities. They are interconnecting their customers and business partners with their core business processes. However they are vulnerable. This vulnerability comes from knowledge that they transact in an insecure environment, an environment bereft of legislation. They too face as much uncertainty about a hacker attack on their corporate databases as the common man does. Depending upon their parent country, companies doing business on the Internet have to face varying degrees of ambiguity regarding the laws that not only constraint but also protect them. Global computer-based communications are cutting across territorial borders, creating a new realm of human activity and undermining the feasibility--and legitimacy-of applying laws based on geographic boundaries.

While these electronic communications play havoc with geographic boundaries, a new boundary, made up of the screens and passwords that separate the virtual world from the "real world" of atoms, emerges. This new boundary defines a distinct Cyberspace that needs and can create new law and legal institutions of its own. Territorially based law-making and law-enforcing authorities find this new environment deeply threatening. But established territorial authorities may yet learn to defer to the self-regulatory efforts of Cyberspace participants who care most deeply about this new digital trade in ideas, information, and services. Separated from doctrine and tied to territorial jurisdictions, new rules will emerge, in a variety of online spaces, to govern a wide range of new phenomena that have no clear parallel in the non-virtual world. Clearly, the shift from a physically oriented commercial environment to a knowledge based electronic environment presents some very serious and substantial issues that must be addressed. Existing regulatory frameworks are likely incapable of adequately taxing electronic transactions, and must be adapted. Otherwise, governments may face a significant decrease in their tax revenues, as more and more commerce takes place over the Internet. The task for government then is to attempt to fit Internet transactions into existing rules of taxation. Where this is impossible, it may be necessary to adapt and amend the rules in order to catch Internet transactions.

Adil Waseem

---

National Security; College Campuses

I have witnessed a new era of security in the... Read More

Politicians Will Save Civilization

Most politicians are completely out to lunch and totally Machiavellian... Read More

Harmonic Beams to Pre-Detonate Shoulder Launched Surface to Air Missiles

Using Harmonic Beams to Pre-Detonate Shoulder Launched Surface to Air... Read More

Seven Things That Make Me Angry

I watch the TV news and I get angry. I... Read More

The Worlds Eldest Democracy Was A Truly Romantic Affair

Visible remnants of the world's eldest democracy can be seen... Read More

Bringing Back Mining Jobs to the United States

With new environmental technologies and modern efficiency methods in mining... Read More

The Dragons

I hope to provide a starting point for the serious... Read More

Hawala, or The Bank That Never Was

I. OVERVIEWIn the wake of the September 11 terrorist attacks... Read More

Cracking Down on Cigar Counterfeiters

In the most rewarding new industries, there is often a... Read More

Socialist Public Schools In America

Many parents might think it a bit farfetched to compare... Read More

MUD

MUD ? Much Unnecessary DisclosureThe Federal Trade Commission recently asserted... Read More

Government Backed Fraud in Academia

Contrary to the Hobbesian prediction of anarchy (freedom) and brutish... Read More

The Project For A New American Century

Let the reader be reminded, that this document we are... Read More

Asking For Proof in the Economic Pudding

There are no stupid questions, only stupid people. Ask an... Read More

Failure to Supervise at the Federal Trade Commission

Many MLM sales people mean well but they inadvertently commit... Read More

US Government Regulators and Aides with AIDS

All government regulators or diplomat who are in high risk... Read More

OSHA is just more BS from the Blob of Bureaucracy

Is Ohio Manufacturing Sector really unable to compete in the... Read More

Is Congress Going to Lay the Groundwork to Include Education with the Steroid Legislation?

As of late steroid use in sports has been the... Read More

Political Lobbying & Biblical Aspects of the Mid-East Crisis

1) IS HAVING A DEMOCRACY MORE EFFECTIVE IN ADDRESSING POLITICAL... Read More

Government Franchise Model; taking it virtual

Our government is set up like a modern day franchise.... Read More

Droughts, Dirty Water and Disease

When we go through periods of droughts we also have... Read More

OPECs Swan Song?

Indonesia's Energy Minister, Purnomo Yusgiantoro, is unhappy with the modest... Read More

A Workable Alternative to Term Limits

The end of another election once again brings into focus... Read More

How to Deal with Poverty

A SOLUTION FOR EMPLOYMENT PROBLEMS TO AID IN THE FIGHT... Read More

Revitalizing The Power of the Baby Boomers

As baby boomers, we have been spoiled all of our... Read More

Canning International Terrorists? Literally

Well here is a great new product, we first saw... Read More

How to Tell When Government Regulators are Shopping You

In this day and age of tattletale, whistleblower heroes and... Read More

Osama bin Laden Needs a Pay Raise

Osama bin Laden probably needs to get a pay raise,... Read More

Public Procurement and Very Private Benefits

In every national budget, there is a part called "Public... Read More

The Lemon Dance: Why Government Doesn?t Work

Former Senator, Daniel Moynihan, accurately summed up the situation when... Read More

3D Modeling for Healthy Forests

Forest Vegetation Simulations for Fire Prevention, Healthy Forest and Saving... Read More

Entrepreneur Lashes Out at Linear Thinking Government Regulators

I am personally calling for a total disbanding of the... Read More

The FTC Purports and Misrepresents Their Law Enforcement Experience as It Attacks Business

We should all give much kudos to the Federal Trade... Read More