Tax Problems and Countermeasures of Digitalized Goods in E-commerce


  • Weiqun Xi University of Sydney School of Business


With the rapid development of e-commerce, the transaction scale of data- based commodities is expanding day by day. However, there are many difficulties in tax treatment of data-based commodities. There are no consistent views on the attributes of tax objects, the definition of tax jurisdiction, tax collection and management mechanism and other issues. Based on analysing the disputes in various countries, combined with the existing problems in China's current tax treatment, the paper suggests that the Chinese government timely revise the tax policy on data products and make it clear that data products belong to services or intangible assets. For cross-border online sales of digitalized goods, tax shall be levied in accordance with the principle of place of consumption (recipient) and the concept of virtual permanent establishment shall be adopted. For B2B transactions, reverse taxation mechanism shall be adopted, while for B2C, a third-party tax collection mechanism shall be adopted. For domestic data commodity transactions, the mechanism of the provider declaring and paying taxes by itself is implemented. 

Author Biography

Weiqun Xi, University of Sydney School of Business

Lecturer | Discipline of Business Law | Honours CoordinatorEditor | The Journal of Chinese Tax and Policy Research Affiliate  |  Cambridge Centre for Alternative Finance, Univeristy of Cambridge Judge Business SchoolAdjunct Associate Professor |  The Department of Public Economics, School of Economics, Xiamen UniversityAdjunct Researcher  |  Center for International Tax Law & Comparative Taxation, Xiamen University