Taxes on e-commerce worldwide

Taxes on e-commerce worldwide

Taxes on e-commerce exist in most States, where e-commerce is a fast-growing industry in the Arab world and elsewhere, but taxes on e-commerce are a relatively complex subject known only to a few people, in order to maintain the accuracy of accounting for e-commerce, which needs to know how to calculate taxes and where to pay taxes, which in turn depends on what your producer is, how your producer and who are buyers.

[Electronic Commerce]

Here are the main factors affecting taxes on electronic commerce:

• Physical or electronic producer - whether you sell material goods (table tools, clothing, attachments, etc.) or electronic products (digital posters, electronic books, videos, etc.).
• How do your goods move - whether you ship the goods from Estonia to abroad, from China directly to a customer or using an intermediary warehouse in the European Union.
• buyers - whether individuals or legal entities, within or outside the European Union.

Value added tax in Estonia and other European Union States

In Estonia, for example, you have to register in value-added tax, if:

• Tax sales in Estonia exceed Euro40,000 annually.
• Selling services/goods from Estonia to private members of the European Union
• Buy electronic services from abroad (for example, use of Amazon, Facebook or Google services, hosting of the web, purchasing of electronic books, electronic courses, etc.).
• Buying more than 10,000 elements annually from European Union States.
• The last two orders -- purchasing electronic services and purchasing goods from the European Union above the minimum -- require limited liability for value-added tax.
• Which means you'll pay VAT on services purchased abroad, but you can't recover VAT on your local purchases.
• So, when it comes to value-added tax obligations, it is wise to become immediately a regular person or fully taxed person.
• In our statement that electronic commerce is taxed in some States, accounting for electronic stores that sell and pay VAT between several countries may be very complex.
• The easier and often cheaper option is to outsource this service from Amazon, for example.

Income tax

• In our article on the subject of electronic commerce to taxes in some States and in some cases the country of origin is entitled to pay income tax deductions from your income.
• Specific rules differ from State to State, so they must be identified to avoid any surprises.
• In particular, the deduction tax is imposed on rents, profits and interest, as well as on electronic products.
• For example, United States payments to Estonia for the sale of electronic products (e.g. e-books) are subject to a 30% deduction tax.
• If you have a local employer identification number, you can reduce it to 10%.
• Corporate tax can become a subject if you have a local shop in another country or a beauty salon there, for example.
• However, income tax obligations may also arise if members of the board of directors of a company registered in Estonia reside elsewhere - for example, a member of the Governing Council of Spain resides.

Sales tax

• In the United States and Canada, they also need to be familiar with the concept of sales tax, which is different from the value-added tax that we apply and is calculated by mandate. In general, the American tax system is so complicated that Estonian accountants can't help you here and certainly don't expect United States tax authorities to overlook it in some places - rules are too strict there.

In some States:

Tax on e-commerce in Saudi Arabia

In our statement that electronic commerce is taxed in some States, Saudi Arabia is a member of the Gulf Cooperation Council and has implemented the Group ' s policy on digital value-added tax from foreign vendors. - The value-added tax rate for digital products is 15% without a record limit. Foreign companies must register in value-added tax in Saudi Arabia.

Also read: [How to settle a free electronic store] (https://trinavo.com/%d9%83%d9%8%d9%81-%d8%a%d8%b3%d9%88%d8%8a-%d9%d8%8%d8%8aa%d8%d8%d8b1-%d8%d8%9%8%d8%8%d8%8%8b8%d8%8%d8%8%d8%8b8%8%8b8%d8%d8%8%d8%8%8b8%d8%8%d8%8%8%d8%8%d8%d8%d8%8%8%d8%d8%8%8%d8%d8%d8%d8%8%d8%d8%8%8%d8%8%8%d8%d8%d8%8%8%8%8%d8%d8%8%d8%d8%d8%d8%8%8%d

[ South Africa] (https://ar.trading economics.com/south-africa/personal-income-tax-rate)

South Africa introduced its VAT rules for e-Suppliers on 1 July 2014. - However, they have a lower limit, as value-added tax is not required to collect or register. - This is R 1,000.000 South African. - Unlike other countries, South Africa does not distinguish between B2C and B2B sales - all of which are subject to VAT fees of 14%. - To a large extent, what kind of digital services you can think about is within their electronic value-added tax rules.

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[Electronic Commerce in Turkey]

• Speaking of taxing electronic commerce in some States since 1 January 2018, Turkey has asked foreign companies, which provide digital goods within the country, to pay attention to the VAT laws.
• Digital tax policies in Turkey depend on whether the sale of a private consumer or a Turkish company is recorded in value added tax.
• If you sell to a value-added tax company in Turkey, foreign business will not need to impose value-added tax.
• The buyer will deal with all Turkish value added tax through the reverse calculation mechanism. In the case of sale to Turkish consumers, foreign businesses must:
• Registration in value added tax in Turkey. There is no limit to sales registration.
• 18% VAT for goods and services sold to Turkish consumers. Refund of the value-added tax file every month. Depositions are due on the next 24th month, and payments are due on the twenty-eighth day.

Also read: [Electronic trends] (https://trinavo.com/%d8%a8%d8%aaa%d8%a7%d9%87%d8%a8%d8%aa-%d8%d9%8%d8%aaa%d8%8%d8%a%d8%8%d8%8%d8%8%8%8%8%d8%9%d8%9%8%d8%d8%9%8%d8%8%8%d8%d8%8%8%8%8%d8%d%8%d8%d8%8%8b%8%8%8%d8%d8%8%d8%d8%d8%d8%d8%d%8%8%8%8%8%d8%d%8%d8%8%8%d8%8%d8%d8%8%d8%8%8%d8%d8%d8%8%d%8%8%8%d8%8%8%d8%d8%d%d8%d%8%8%8%8%

Some countries that introduced digital tax in 2020-2021

In 2021, Cambodia introduced a value-added tax of 10% for non-resident vendors with a minimum of SK 250.000.000.000.000. Cameroon has broadened the commitment of non-resident companies to levy value-added tax and collect it to provide material goods and electronic services to consumers and companies. Chile imposed a value-added tax of 19% on the first of June 2020, and tax will be collected through value-added tax records of a non-resident supplier, or on the basis of a deduction by propellants, including credit card companies. In our statement that electronic commerce is taxed in some States, Egypt introduced in 2021 a value tax added to 14% for a non-resident seller at a minimum of 500,000 Egyptian pounds. Indonesia imposes a 10% VAT on all online transactions, with a minimum of 600,000.000 Indonesian rupees. In 2021, Kenya introduced a 16% VAT to all non-resident vendor transactions, which means that the minimum is zero. VAT must be collected from the first sale.

At the end of our article on the subject of electronic commerce to taxes in some States and as a digital owner, you really need to identify and understand where foreign tax rules may apply to your work, the best source to ensure that you do not have any problem is to ask an accountant or a qualified agent within the country you want.