Appendix Appendices. Jurisdictional Analysis

Transcription

1 Appendices Springer International Publishing Switzerland 2015 A.M. Bardopoulos, ecommerce and the Effects of Technology on Taxation, Law, Governance and Technology Series 22, DOI /

2 362 Appendices Appendix 1 Jurisdictional Analysis Place of supply rule Electronically Supplied Service Definition Telecommunicat ions Definition Country Principle Applied VAT / GST Reach Origin Destination Hybrid Global Zero rating exports (Z) / Exempted (E) Territorial Reverse Charge Mechanism B2B only B2B & B2C Digital Products Treated as Services only Goods or services Applies to all Registration Threshold Residents only For Non- Residents United Kingdom Z Sweden Austria E Ireland Z Russia Z Switzerland European Union OECD Z * New Zealand Z South Africa Z Australia E Brazil China Z Japan Z Canada International Inter- Provincial Z USA New York Iowa Alabama * Appendix II of the Ottawa Taxation Framework, Analysis of Various Categories of Typical E-commerce Transactions provides several definitions relating to electronically supplied services VAT principles, rules, model applied according to research as of VAT system moving towards EU Model: Assumed to be destination principle, & if moving towards EU then Hybrid Assumption based on the fact that similar to the EU model apart from certain differences including the manner in which VAT is determined. Not Applicable Assumed Uncertain

3 Appendices 363 Appendix 2 Table 1 as set out in HMRC Electronically Supplied Services: A Guide to Interpretation which is taken from Annex L of the EU VAT on E-Commerce Directive (2002/38/EC) Annex l reference Item 1 Supplies covered by the legal text A. Website supply, web hosting and distance maintenance of programmes and equipment Example of a service that is an electronically supplied service Website hosting and web page hosting Automated, online distance maintenance of programmes Remote systems administration Online data warehousing (in other words where specific data is stored and retrieved electronically) Online supply of on demand disc space Item 2 A. Software and updating thereof Accessing or downloading software (for example procurement/ accountancy programmes, antivirus software) plus updates Bannerblockers (software to block banner adverts showing) Download drivers, such as software that interfaces PC with peripheral equipment (for example printers) Online automated installation of filters on websites Online automated installation of firewalls Item 3 A. Images Accessing or downloading desktop themes B. Text and information Accessing or downloading photographic or pictorial images or screensavers C. Making databases available The digitised content of books and other electronic publications Subscription to online newspaper and journals Weblogs and website statistics Online news, traffic information and weather reports Online information generated automatically by software from specific data input by the customer, such as legal and financial data (for example continually updated stock market data). The provision of advertising space (for example banner ads on a website/webpage) Use of search engines and Internet directories (continued)

4 364 Appendices Annex l reference Supplies covered by the legal text Example of a service that is an electronically supplied service Item 4 A. Music. Accessing or downloading of music onto PCs, mobile phones, and so on B. Films. Accessing or downloading of jingles, excerpts, ringtones, or other sounds C. Broadcasts and events political, cultural, artistic, sporting, scientific and entertainment. D. Games, including games of chance and gambling games. Accessing or downloading of films Web-based broadcasting that is only provided over the Internet or similar electronic network and is not simultaneously broadcast over a traditional radio or television network, as opposed to Item 4, Table 2 Downloads of games onto PCs, mobile phones, and so on Accessing automated online games which are dependent on the Internet, or other similar electronic networks, where players are remote from one another Item 5 A. Distance teaching. Teaching that is automated and dependent on the Internet or similar electronic network to function, including virtual classrooms, as opposed to Item 2(b), Table 2 Workbooks completed by pupil online and marked automatically, without human intervention Item 6 Other services included A. Those not explicitly listed in Annex L. Online auction services (to the extent that they are not already considered to be web hosting services under Item 1) that are dependent on automated databases and data input by the customer requiring little or no human intervention (for example an online market place or online shopping portals), as opposed to Item 3(f), Table 2 Internet Service Packages (ISPs) in which the telecommunications component is an ancillary and subordinate part (in other words a package that goes beyond mere Internet access comprising various elements (for example content pages containing news, weather, travel information; games for a; web hosting; access to chatlines and so on))

5 Appendices 365 Appendix 3 Table 2 as set out in HMRC Electronically Supplied Services: A Guide to Interpretation which is taken from Annex L of the EU VAT on E-Commerce Directive (2002/38/EC) Example of a transaction not considered to be a supply of an electronically supplied service Rationale 1. A supply of: These are supplies of goods (a) A good, where the order and processing is done electronically (b) A CD-Rom, floppy disc and similar tangible media (c) Printed matter such as a book, newsletter, newspaper or journal (d) A CD, audio cassette (e) A video cassette, DVD (f) Games on a CD-Rom 2. A supply of: This is a supply of service that (a) services of lawyers and financial consultants and so relies on substantial human on, who advise clients through intervention and the Internet or (b) interactive teaching services where the course electronic network is only used as content is delivered by a teacher over the Internet a means of communication or an electronic network ( :::via remote link) 3. A supply of: These are supplies of services that (a) Physical repair services of computer equipment (b) Offline data warehousing services (c) Advertising services, such as in newspapers, on posters and on television (d) Telephone helpdesk services (e) Teaching services involving correspondence courses such as postal courses (f) Conventional auctioneers services reliant on direct human intervention, irrespective of how bids are made (for example in person, Internet or telephone), as opposed to Item 6(a), Table A supply of a radio and television broadcasting service provided over the Internet or similar electronic network simultaneous to the same broadcast being provided over traditional radio or television network, as opposed to Item 4(c), Table 1 are not delivered over the Internet and rely on substantial human intervention This is a supply of a radio and television broadcasting service, which is covered by the penultimate indent of Article 9(2)(e) 5. A supply of: These are supplies of (a) Videophone services ( :::telephone services with a telecommunication services and video component) are covered by the place of supply (b) Access to the Internet and world wide web rules for such services under the ninth indent of Article 9(2)(e) (c) Telephony ( :::telephone service provided through the Internet)

6 Index A Addition method, 152, 153 Administrative problems, 15, 357, 359 AdWords, Agent, 103, 122, 126, 127, 132, 133, 162, 216, , 252, 260, 264, 311, 315, 350 Algorithm, 46, 278 Amazon/Amazon.com, 5, 11, 46 59, 66, 69, 73, 74, 79, 80, 98, 102, 123, 138, 145, 185, 187, , 242, , 249, 260, 261, , 273, 275, 276, 280 a founding father, 55, 56 tax, 10, 11, 50, 56, 58, 59, 66, 69, 74, 79, 82, 123, 124, 138, 145, 146, 241, 244, 245, 247, 260, 261 ARPANet, Australia, 8, 11, 12, 72, 93, 94, 98, 110, 125, 163, 199, , 270, 271, 289, 291, 362 Austria, 170, 187, , 362 Avatar, 54, 55, 103, 267 B Basic economic laws, 5, 139 Benefit theory, 118, 119, 123 Bit tax, Borderless virtual world, 81, 258 Brazil, 10, 12, 199, 213, 362 C Canada, 13, 26, 91, 92, 144, 151, 212, , 236, 237, 258, , 279, , 356, 359, 362 Cascading turnover tax, 24, 25, 27, 150 Central management and control, 14, 93, 98, 100, 264, 288, 289 China, 10 12, 213, 214, 262 Clustering technology, 45 Colocation, 320, 321, , 330, 331 Commercial hub, 11 13, 26, 55, 145, 170, 214, 240, 258, 356 Consumer anonymity, 59, 260 Consumption tax (CT), 2, 4, 7, 12, 13, 26, 27, 35, 63, 73, 74, 82, 110, 139, 144, 151, 155, 156, 158, 163, 166, 189, 215, 236, 242, 263, 356, 357 Copyright software, 299, 307 Correlative framework, 274 Credit-invoice method, 154 Credit-subtraction method, Cross-border, 11, 13, 15, 28, 100, 118, 145, 151, 156, 158, , 178, 180, 189, 202, 208, 212, 213, 218, 226, 227, 236, 242, 244, 258, 263, , 277, 279, , 339, , 348, D Dawn s place, Dedicated server, 320, 321, 325, Destination jurisdiction, 187, 316 principle, 2, 13, 152, 154, 164, , 187, , 236, 247, 251, 263, 271, 274, 315, 358, 362 Double tax agreements, 68, 88, 162, 290, 337 DTA dual residence, 92 Duration test, 31, 124, 125 Springer International Publishing Switzerland 2015 A.M. Bardopoulos, ecommerce and the Effects of Technology on Taxation, Law, Governance and Technology Series 22, DOI /

7 368 Index E ebay, 49 52, 65 ecommerce/electronic commerce/e-commerce, 2 9, 12 16, 26, 29, 30, 34, 39, 41, 43, 49, 50, 52, 53, 63 68, 72 75, 82, 88, 92, 94, 98, 109, 110, , 138, 139, 146, , 158, , 171, 176, 178, 183, 193, 202, 208, 211, , 236, 237, 240, 241, 244, 251, 258, 259, 261, , 274, 275, 277, 304, 314, 316, , 348, Economic allegiance theory, 120 Economic nexus, 99, 100, 102, 289 Electronically supplied services, 35, 166, 182, 183, 186, 187, , 199, 206, 225, 268, 269, 292, 293, , 310, 329, 330, Electronic transactions, 3, 66, 67, 240 emarket, 188, 236, 258, 277 Entitlement theory, 119, 290, 309 eretailers, 49, 50, 55, 80, 169, 185, 244, 246, 247, 252, 259, 262, 265, 266, 275, 280, , etax, 7, 9, 10, 13 15, 26, 50, 59, 62, 66, 72, 74, 88, 109, 144, 145, 213, , , 302, 346, 350, European Union (EU), 10, 12, 15, 27, 33 36, 56, 68, 69, 125, 144, 154, 162, 166, , , , 209, 212, , 225, 226, 236, 249, 258, 260, 261, , 279, , 296, 303, 304, , 356, 357, 362, 363, 365 EU VAT directive, 35, 170, 188, 189, 191, 197, , 303, 304, 329 EU VAT system, 144, 171, 173, 220, 225 Exclusive taxation rights, 119 F Failover sites, 44 Fastest Response Time Method, 45 Flexibility, 3 6, 14, 28, 64, 82, 88, 89, 104, 133, 135, 139, 151, 155, 172, 212, 251, 258, 264, 267, 271, 306, 356, 358, 359 Fraud, 158 Functional equivalence approach/functional equivalence, 4, 66 68, 72, 83, 155, 229 G Geographical location test, 6, 10, 44, 46, 51, 74, 88, 98, 104, 132, 138 Global harmonization, 15, 275 Globalization, 2, 15, 274 Google, 49, 51, 59, 100, 174, 278, , 323 Government unrestricted access to personal information, 61, 261 H Harmonization, 15, 144, 170, 186, 191, 212, 226, 263, 264, 271, 274, 275 Harmonized Sales Tax (HST), 217, 219, 279 Here and there is synchronically possible, 10, 75 I Illustrative examples/case study(ies), 133, 154, 155, 265, 273, , , , 339, 340 Indirect consumption-based, 12, 213, 258, 356 Infringement of privacy, 69, 261 Input tax, 152, 154, 155, 215, 296, 328 In-state affiliates, 79, 80 Intangible property, , 209, 210, 220, 221, , , 241, 269, 312, 313, 344 International taxing regime, 30 Internet privacy, 58, 260 sales tax, 50, 58, 69, 261, 315 Internet service provider (ISP), 4, 44 48, 53, 62, 65, 66, 83, 88, 101, 102, , 203, 226, 291, 321, 364 Interplanetary gateway, 62 Inter Planetary Network (IPN), 62 Ireland, 47, 69, 170, 187, , 261, , 295, 296, 362 ISP. See Internet service provider (ISP) ITunes, 49, 50, 53 54, 74, 207, 208, 278 J Japan, 10, 11, 27, 28, 76, 144, 153, , 362 Japanese Consumption Tax, 144, 215 L Load-balancing, 45 48, 62, 88, 102, 133, 134, 310 M Microsoft, 45, 49 51, 59, 261, 278, 323 Model Tax Convention, 3, 33, 34, 90, 134

8 Index 369 Multinational treaty agreement, 35 Multistage methods, Multi-stage VAT, 26 Multi-tier VAT rate system, 146, 149 Mutating technology next generation taxing regime, 2 N Network load balancing, 45 New Zealand, 10, 12, 67, 82, 83, 144, 146, , , 221, , 286, , , 320, , 351, 362 Nexus/economic nexus, 57, 99, 100, 102, 103, 184, 240, 242, 243, , , 289 O OECD. See Organisation for economic co-ordination and development (OECD) One-stop-scheme, 166, 187, 188, 249, 279 Ordinary resident test, 91 Organisation for economic co-ordination and development (OECD), 3, 5, 9, 14, 15, 30, 33 35, 39, 63, 67, 68, 70, 88, 90, 92 94, , 112, , , , , , 184, , 202, 203, , 228, 236, 261, 264, 271, 277, 279, 288, 290, 291, 306, 319, 340, , 349, 350, 356, 357, 362 Origin principle, 13, 152, 154, , , 236, 263, 271, 358 Ottawa Taxation Framework, 9, 34, 103, 151, 155, , 187, 202, 209, , 288, 362 Outer space ISP, 134 Output tax, 152, 154, 155, 190, 209, 295, 296, 304, 326 P PayPal, 47, 49, 52 Perceptive method, 45 Permanent establishment, 3, 5, 6, 11, 63, 88, 89, 109, 110, , , 138, 162, 203, 209, 213, 216, 219, 221, 241, 244, 263, 266, 290, 291, 306, 307, 310, 315, 316, 344, 350, 355, 356, 358 Physically performed, 146, 204, 211, 272, 301, 314 Physically present per the internet, 10, 74 Physical presence/physically present, 3 6, 10, 11, 13, 56 58, 72 76, 78 83, 90, 91, 100, 103, 104, , 138, 139, 145, 185, 223, 236, 240, 244, 246, 247, 252, 253, 263, , 279, 301, 302, 306, 307, 309, 311, 313, 314 Physical presence test, 63, 90, 91 Physical world, 3, 52, 67, 72 81, 103, 259, 261, 262, 267 Piedras Negras, 123, 124 Pirate Bay, 208, 275, 276 Place of consumption/place of supply, 2, 10, 13, 14, 82, 146, 151, 162, , 170, 175, , , , 206, 208, 209, 213, , , , 271, 273, 279, 292, 293, 295, , 310, 311, 314, 315, 326, 329, 330, 356, 358, 362, 365 Place of management/place of effective management/place of incorporation/place of residence of management, 14, 90, 92 94, , 104, 180, 190, 191, 197, 264, 267, 288, 290, 306, 308, 309, 357 Portal, 44, 312, 364 Presence, 7, 10, 13, 26, 28, 74 83, 91, 123, 132, 138, 139, 164, 193, 240, 244, 246, 247, 252, 264, 267, 302, 310, 315, 316, 331, 350 Presence explicated, 76, 77 Principle of neutrality, 12, 236 Privacy, 9, 58, 59, 66, 68 69, 82, 164, 240, 259, 260, 266, 277, 280 Provincial sales tax and GST, 236, 237 Q Quantum computing, 278, 279 Quill, 56, 57, 124, 246 R Real world, 4, 54, 55, 59, 72, 73, 80, 83, 260, 266, 267 Reconceptualisation/reconceptualization, 16, 139, 212, 229, 265, 274, 359 Registration threshold, 158, 165, 188, 196, 197, 199, 200, 205, 213, 272, 274, 279, 294, 295, 300, 316, 329 Residence, 2, 5 7, 14, 48, 54, 87 94, , 109, 120, 121, 164, 165, 185, 191, 197, 200, 203, , 271, 272, , 293, 296, 306, 308, 309, 314, 316, 330, 346, 355, 357, 358

9 370 Index Residence versus source, 261, 355 Retail sales tax system, 12, 13, 170, 217, 251, 258, 263, 264, 356 Round robin DNS, 45 Russia, 10, 170, 195, 198, 199, 362 S Sales-subtraction method, 152, 153 Seamless virtual world, 66 Second Life, 50, 54 55, 73, 80, 98, 102, 103, 139, 166, 185, 229, 263, , 286, , 307, 309, 312, 315 Server, 5, 8, 43 46, 53, 63, 80, 88, 89, , 208, 224, 229, 244, 271, 278, 287, 291, 300, 301, 303, 307, 310, 314, 315, , 350, 355, 357, 358 Shared hosting, , Shared principles, , 162 Sixth VAT Directive/VAT Directive, 33, 35, 56, 162, , , 188, 189, 191, 192, , , 303, 304, 306 Somewhere in cyberspace, 44 Source, 2 9, 14, 24, 27, 39, 44, 46, 48, 79, 88 90, 99, , , , 138, 165, 170, 228, 261, , 274, , 296, 303, 306, 307, 309, 310, 315, 316, 323, 324, 344, 346, 350, Source State, 119, 120 South Africa, 4, 10, 12, 27, 29, 46, 47, 64, 66, 67, 89, 117, 157, 162, 185, , 271, 273, 276, 286, 293, 295, 296, , 306, 310, 311, 320, , 331, 351, 362 Streamlined Sales And Use Tax Agreement (SSUTA), 145, 243, 244, 250, 251, 253, 275 Streamlined Sales Tax Program (SSTP), 236, , 263, 275 Sweden, 151, 157, 170, 183, 186, 187, , 300, 301, , 310, 315, 356, 362 Switzerland, 47, 127, 162, 170, 195, T Tax avoidance/tax evasion, 3, 4, 23, 65, 68, , 259, 262, 276, , 350 TCP/IP-based services, 41, 45 Technological revolution, 28 Tie-breaker clause, 92, 100 Traditional tax, 2 7, 24, 50, 82, 88, 104, 109, 359 U UNCITRAL Model Law, 63, 67, 68 United Kingdom (UK), 8, 47, 92, 93, 103, 117, 118, 170, 174, 175, 183, 186, , 303, 305, 320, 327, , 356, 362 United States of America (USA), 8 13, 24, 26, 33, 34, 40, 46 48, 50, 51, 54, 56 58, 66, 68, 69, 90, 92, 116, 123, 124, 127, 145, 146, 151, 162, 164, 170, 185, 207, 213, 215, 217, 218, , 258, 260, 261, 263, 264, , 279, 285, 286, , , 322, 356, 359, 362 USA retail sales tax, 218, 264 USA Sales Tax System, 240 USA Streamlined Sales Tax Agreement (SSUTA), 235, 243, 244, 250, 251, 263, 275 USA Streamlined Sales Tax Program (SSTP), 236, 242, 243, 263, 275 Use and enjoyment override rules, , 293 V VAT compliance, 188 VAT versus non-vat jurisdictions, Virtual agents, 350 Virtual customer, 164 Virtual marketplace, 51, 52, 54, 55, 59, 72, 73, 80, 166, 260 Virtual presence, 76, 80, 81 Virtual property, 73, 80, 81, 102, 268 Virtual safety deposit box, 325, 332 Virtual storage space, 322, 330, 332 Virtual world, 2 8, 10, 12 16, 28, 40, 44, 49 56, 58, 59, 63 66, 72 76, 79 83, 88, 89, , 110, 120, 122, 138, 146, 166, 185, 240, , 289, 290, 295, 301, 302, 306, 307, , 313, , 350, Virtual World Conference, 55 Virtual world income, 263 Virtual world versus physical world, 72 81, 185, 242, 244, 246, 247 W Web traffic, 44 47