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Abstract

Electronic commerce may be a great equalizer that helps to reduce, or even to eliminate, distance-related barriers to trade, but it can also exacerbate a so-called ‘digital dividend’ vis-à-vis countries with technological and infrastructural deficiencies, especially developing countries. In the following we concentrate on trade distortion caused by taxation of e-trade in intangible goods. We believe this will have a particular ramification for the developing world. General Agreement on Trade in Services (GATS) provisions may be relevant to many concerns with respect to the regulations of e-commerce, such as online privacy protection, illegal or illicit content, cyber crime and fraud, en-forcement of contracts, consumer protection, and taxation. In this paper, we will focus our debate mainly on the issues of taxation of e-trade with respect to the two basic principles of the WTO, that is. the Most Favoured Nation (MFN) and the National Treatment (NT) principles.

Keywords

e-trade taxation trade distortion

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Should the WTO deal with e-trade taxation issues?

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