E-Commerce Commission Press Kit

More documents

Recommendations

Info

To Tax or Not to TaxThe opening of the 21st century marks the dawn of a new and fundamentallydifferent age of unlimited access to information and unlimited opportunities to improvethe lives of all people through the use of information technology. The Internet and thepersonal computer will enable individuals and corporations to purchase goods andservices and to exchange information in a profoundly new way.In the past five years, Internet e-mail and World Wide Web sites havetransformed both personal and business information exchange around the globe. In time,it will be as easy for business and individual consumers to buy and sell from peopleacross the globe as from people across the street.The economic impact of this is enormous accounting for more than $300 billionin U.S. business last year alone. The Internet promises to level barriers to market entry,provide all consumers with total access to all product information, and connect all buyersto all sellers. It will effect near perfect market competition classic, textbook competitionthat even Adam Smith would marvel. Indeed, universal market access over the Internetalready is reducing the cost of doing business and providing access to untapped markets,workforces, and suppliers. According to one national study, 56 percent of U.S. companieswill see their products online by 2000, up from 24 percent in 1998.Recognizing these massive changes on the economic horizon, the U.S. Congresspassed the bi-partisan Internet Tax Freedom Act (ITFA) in October 1998. Co-sponsoredby Rep. Christopher Cox (R-CA) and Sen. Ron Wyden (D-OR), the Act placed a threeyearmoratorium on Internet taxation and established the Advisory Commission onElectronic Commerce to review Internet taxation issues. The Commission, whichcomprises a balance of public- and private-sector representatives, is to report itsrecommendations to Congress by April 2000. Its first meeting will be held on June 21and 22 in Williamsburg.The Commission will consider the competing goals of promoting the Internet'seconomic potential, addressing state and local revenue needs and preserving the privacyof those who log on. As with any new industry, a complex tax burden can stifledevelopment and growth. Yet revenue needs of states and localities also are undeniable.Another concern is how other nations may tax e-commerce and the international tradeand U.S. competitiveness.1
Traditional business and sales tax models were designed for the physical, or precyberworld, where buyers and sellers transacted business solely in stores. Today, thereare 5,000 separate state and local tax jurisdictions in the United States with tremendousvariation in rates, product categories, exemptions, and administrative approaches. It is acomplex quilt of sales tax requirements that significantly impedes inter-state marketerswho could be saddled with responsibility of administering and policing tax requirementsacross U.S. and international boundaries.The e-economy may require a re-thinking of established business practices andexisting taxation models. As buyers and sellers on the Internet do not have to meet face toface in a given place, some argue that old tax models may no longer fit the emerging e-economy.Nevertheless, some state tax jurisdictions have begun to tax the Internet. Whilethe debate has focused at the state-tax level in the United States, the issue has majorimplications for national sales, business, and income tax models. If a buyer from place"a" buys goods and services from a seller in place "b," where would the local governmentlevy its taxes? What about the worker employed by a business that operates and sells itsproducts in cyberspace? Which government body has the jurisdiction to levy incometaxes on that employee and business? The Internet has the potential to underminetraditional forms of state and local revenues in proportion to its huge social and economicbenefits.The Commission's challenge is to map the rules of engagement for a new virtualbusinessparadigm. Whether existing systems of taxation can be modified to adapt to theInternet or whether new models of taxation need to be developed will be a key question.So too will be whether taxes can be imposed on e-commerce while protecting consumerprivacy. It is too soon to say how the Commission will resolve these and many otherissues. But our debates will be robust, and our search for solutions will be open, honestand fair.2
Page 2 and 3: Frequently Asked QuestionsHow was t
Page 6 and 7: Commissioner BiographiesDean Andal,
Page 8: Paul Harris, Sr., Delegate, Virgini
Page 11 and 12: Robert Novick, General Counsel,Offi
Page 13 and 14: Stanley Sokul, Independent Consulta
Page 15 and 16: (d) Definition of Generally Imposed
Page 17 and 18: (D) Internet access service.--The t
Page 19 and 20: (b) Membership.--(1) In general.--T
Page 21 and 22: (B) an examination of the collectio
Page 23 and 24: (iii) imposes an obligation to coll
Page 25 and 26: (B) Exception.--Such term does not
Page 27: (2) to accelerate the growth of ele
Page 31 and 32: THE EMERGING DIGITAL ECONOMYIntrodu
Page 33 and 34: INTRODUCTIONDuring the past few yea
Page 35 and 36: CHAPTER ONE:THE DIGITAL REVOLUTIONT
Page 37 and 38: What makes this rise in IT’s nomi
Page 39 and 40: Despite these impressive trends, th
Page 41 and 42: Hundreds of new firms are starting
Page 43 and 44: Table 3. The Race to Build Out the
Page 46 and 47: usiness electronically with new sup
Page 48 and 49: increased 40 percent over the previ
Page 50 and 51: from one supplier to another. It co
Page 52 and 53: and maintaining customer relationsh
Page 54 and 55: For a business to feel comfortable
Page 56 and 57: CHAPTER FOUR:DIGITAL DELIVERY OF GO
Page 58 and 59: and marketing costs may become too
Page 60 and 61: Lower sales and marketing costsIt i
Page 62 and 63: large bank, the initial investment
Page 64 and 65: Table 4. Internet Sales of Personal
Page 66 and 67: For the multimedia industry, the qu
Page 68 and 69: ook according to topic. The topic c
Page 70 and 71: THE FUTUREAnalysts believe that Int
Page 72 and 73: Often today, consumers are not give
Page 74 and 75: CONVENIENCEConsumers cite convenien
Page 76 and 77: This pattern of lower prices is not
Page 78 and 79:
CHAPTER SEVEN:WORKERS IN THE DIGITA
Page 80 and 81:
WORKFORCE FLEXIBILITYWorkforce flex
Page 82 and 83:
CHAPTER EIGHT:CHALLENGES AHEADThis
Page 84 and 85:
ENDNOTES1. “Monetary Policy Testi
Page 86 and 87:
(CERN) in Switzerland. In 1991, the
Page 88 and 89:
34. Shankar, Bhawani. “Digital TV
Page 90 and 91:
55. Number of Online Newspapers on
Page 92 and 93:
78. “Internet Insurance: A Study
show all

E-Commerce Commission Press Kit

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?