Friday, September 2, 2011

Ecommerce tax issue is controversial.

Some people think that all the business should be treated equally and the online business needs to pay tax as real shop business.

While other people think that ecommerce can be scrapped from tax since it could maintain low price advantage for online shops and it is not easy to identify all the online shoppers.

A report revealed that a company has sold clothes very well on online market but it has been levied more than 4.3 million yuan ($ 665,000) tax.

Will the move lower the online businessman's efficiency or drive them to increase the price of the products they sell on the internet? And then, consumers will go back to visit real shops rather than online shops.

The big trend is more and more people starting online shopping and more and more companies seeking customers on the internet and some has succeeded in online foreign trade business now.

In order to meet the trend, the national government has started to take measures to support online business and trade.

Once the government imposes tax on Internet transactions without any deductions or exemptions, it will become difficult for many online businesses to survive, especially for some medium and small sized companies.

Furthermore, current tax policy is not applicable for ecommerce.

IBUonline is an innovative B2B portal and it has kept an eye on ecommerce tax policy in China.

If you are developing foreign trade on B2B platforms, you can go to IBUonline homepage to register as a member. IBUonline has launched foreign trade entrustment service and easy order service to help foreign trade.

Some experts estimated that up to 2002, China e-commerce business revenue has reached ¥10 billion, which is a good opportunity and a severe challenge for china tax industry development.

On one hand, ecommerce has been a catalytic agent for economic development and it is sure that China business development is driven greatly and tax is also increased largely as a consequence.

On the other hand, current tax levy principle is based on real shop or store transactions, which is not suitable for ecommerce development so there are many problems for tax levy on ecommerce.

Ecommerce is movable and ecommerce could be easily hidden so there must be one unique code for ecommerce tax payer, which is within national standards.

Tax payers need to submit information, including websites, website ip, goods posted on the websites, and transaction payment tools, online bank account for registration in tax bureau.

Tax levy range should be expanded and goods products transactions and labor services business should also be covered.

Now three payment tools are popular, customers account payment, credit card payment, e-currency payment.

So tax levy may be processed on online banking payment settlement. If there is transaction payment, consumers' residential local bank takes charge of deduct value added tax and pay tax to the local tax bureau.

It can assure that tax can be collected on time and it can prevent tax evasion.

IBUonline is an innovative B2B portal and IBUonline pay attention to ecommerce tax policies in China.

If you have interest in B2B business and are developing foreign trade on B2B platform, please go to IBUonline homepage to register for free.

IBU is more than an international business platform; we not only connect global buyers and suppliers, but also participate in the whole process of international trade, provide a series of practical services (off the platform) to greatly enhance the efficiency of global trade.

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