Tag Archives: ecommerce

USA: Kansas expands sales and use tax nexus

On April 16, 2013, Kansas Governor Sam Brownback signed a new bill – S.B. 83, which generally creates a presumption that out-of-state retailers are doing business in the state for sales and use tax purposes based on the activities of other persons, applicable starting July 1, 2013.

The bill also adopts “click-through” nexus, applicable to sales made 90 days after the bill is published in the Kansas Register. Out-of-state retailers should be aware that, following the enactment of S.B. 83, the activities of an unrelated entity or person could potentially create sales and use tax nexus in Kansas.

Nexus based on activities of other persons

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US: Internet Sales Tax is coming?

It might well happen that in the not so far future all US online vendors with over $1 million in annual online revenue will be required to pay state and local taxes to the governments that their customers reside in. There are more than 9.600 different state and local tax jurisdictions within the US. This news makes issues related to the upcoming EU VAT 2015 ebiz changes look like a piece of cake.

A federal Marketplace Fairness Act was submitted to the US Congress in February 2013 and aims to substantially reform the taxation of the ecommerce industry in the US. PwC’s summary on the bill can be accessed here. For some more information on the taxation of internet transaction in the US we suggest you to read this report. Find out more

Malaysia: Guidelines on taxation of ecommerce

The Malaysian tax authority has recently issued guidelines on the taxation of electronic commerce in Malaysia. The document provides guidance on the tax treatment of e-commerce transactions, including scope of the tax liability, treatment of servers and websites in determining the location of the ecommerce income,  issues on withholding tax and double taxation and examples of the various business models with relevant explanations.

A new approach to the internet taxation

While Malaysia has not implement the VAT taxation (it applies sales tax) it has introduced a unique way to tax ebiz. This is effected by imposing a withholding tax (“WHT”) liability on the Malaysian recipients (both B2B and B2C) in relation to any royalty type payments made to non-Malaysian companies. Find out more

Netherlands: Reverse-charge for sale of certain IT hardware and mobile phone devices

From 1 April 2013, business involved in supplying large quantities of certain IT hardware and mobile devices (e.g. mobile phones, tablets, laptops, game consoles, integrated circuit devices…) in the Netherlands must no longer charge Dutch VAT on their invoices to other businesses.

From this date on, if the total value of any single local supply of these goods is EUR 10.000 or more, the “reverse-charge mechanism” will be applicable. This means that the purchaser has to self-account for VAT on the transaction in his own VAT return. If the business customer is entitled to full input VAT recovery, a simultaneous input VAT recovery can be made in the same VAT return, so that there is not VAT payment liability is attached to the transaction. Find out more

Featured: 10 myths of multichannel retailing

This is the sixth consecutive year that PwC has published a study of online shoppers, and our second truly global survey.

Below are some highlights from this year’s report.

  • 59% of respondents follow brands or retailers on social media, compared to 49% last year
  • When it comes to their favorite brands and retailers, 38% of our respondents are following them on social media; up from 33% last year
  • 27% of respondents discovered brands through social media, compared to 17% last year
  • Fully 49% of our survey sample said they use social media every day, an increase of 14% over last year
  • Find out more

EU: 2015 VAT changes to eservices – the “keep it simple” edition

First and the most important fact: These rules are mandatory for any kind of ebusiness, no matter where it is established or has a nexus: in EU, US, China, India, Australia, Switzerland. As soon as a company provides eservices to a non VAT registered EU customer (regardless whether the customer is a legal or a natural person) it is bound by these rules, regardless whether it has a “physical” presence, server or agent in the EU. The customer’s location is the only thing that matters.

We have already presented some of the upcoming VAT changes to eservices (and also telecom and broadcasting services) previously. Find out more

Cross-border ecommerce whithin the EU

Ordering goods per internet that are sent directly to your home has become increasingly popular these days. It’s easier, more convenient and you can do it while riding a bus or waiting for your dentist appointment. While you could already buy clothes from catalogues decades ago, you can even do your groceries shopping via your smart phone today. But what are the tax obstacles in this area for companies offering those services within the EU?

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Australia: Results of the Low Value Import Relief review

The final report of the Low Value Parcel Processing Taskforce (“the Taskforce”) was recently released by the Australian authorities.

In a previous report in 2011 the Productivity Commission found that the low value import exemption threshold for GST and duty on imported goods (currently set at AUD 1’000) was not the main factor affecting the international competitiveness of Australian retailers (this is a totally opposite conclusion than the one made by the EU – see here for more info) . The Productivity Commission advised that there could be grounds to reduce the low value import relief threshold, but it is not cost-effective to do so without streamlining the procedure of processing low value parcels.
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Asia: The physical side of ecommerce

Ecommerce in Asia is booming. China alone is forecast to grow to an over US $350 billion industry by 2016. While some markets may already be considered mature (Australia, for example), the growth of internet connectivity and consumer purchasing power cannot be ignored by either small-to-medium enterprises or multi-national corporations looking to reach new consumers.

Ultimately, e-commerce is likely to continue growing because it can more easily provide a wide variety of products at  lower prices and greater flexibility to customers, which in turn leads to an enhanced shopping experience.

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