ICC has published an inaugural issues brief on World Trade Organization negotiations on the trade-related aspects of e-commerce.
The issues brief – the product of extensive consultation with businesses across a range of sectors participating in or affected by the digital economy – will form part of a series of briefs by ICC to assist WTO Member States in their plurilateral negotiations in Geneva. The negotiations, now involving 80 Member States, seek to achieve a high standard outcome that builds on existing WTO agreements and frameworks. The brief, Taxation of Physical Goods in the Context of E-commerce: Avoiding Non-tariff Barriers through Simple and Consistent Design, highlights a growing concern for micro-, small- and medium-sized enterprisess (MSMEs) accompanying the impressive growth in the cross-border sale of physical goods purchased online: the propensity for Goods and Services Tax (GST) /Value Added Tax (VAT) regimes to constitute non-tariff barriers to trade unless they are designed in a simple and consistent way. The brief sets out five key recommendations for WTO Members to ensure that their GST/VAT regimes do not hamper e-commerce growth. They are:
Minimise discrimination between domestic and non-domestic businesses in registration requirements and ensure tax systems are technology-neutral in application.
Allow suppliers, where relevant, to collect and remit taxes away from the border.
Maintain or establish appropriate de minimis thresholds, allowing customs agencies to focus on safety and security rather than on domestic tax collection.
Ensure that registration and tax payment processes are simple, consistent and non-discriminatory.
Do not require a place of business or fiscal representative in the country of destination in order to supply goods.
Source: ICC
