United States Characterization of E-Commerce Transactions for Tax Purposes

Characterization of e-commerce transactions for tax purposes is an essential issue to be addressed by governments, whose public and private sector participate in e-commerce dealings. Governments have a legitimate interest in determining how e-commerce transaction will be taxed, and creating an environment suitable for the growth of e-commerce; whereas the private sector in each country must know the standards for the characterization of e-commerce transactions for tax purposes because e-commerce has the potential of creating new markets for their businesses. The United States approach to the characterization of e-commerce is provided in this article.

The following questions have been addressed in this article:

How does the United States characterize the transfer of computer programs?
What is the United States approach to revenues from electronic sell of goods and services rendered through electronic transactions?
How does the United States address the problem of characterizing revenue from e-transactions as service or lease?


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