Report: China to tax E-Commerce

The United States has a ban on Internet taxes, but China will not let electronic

commerce go tax-free, the director of the country's State Administration

of Taxation has said.

E-commerce is no different from selling in physical stores and should

not be exempted from taxes, said Jin Renqing, in an interview with the news

weekly Outlook, according to the official Xinhua news agency.

China wants to maintain a neutral tax policy and preserve its tax jurisdiction,

Renqing said. The country of more than 1 billion people is expected eventually

to become a major e-commerce market.

Currently, only 16.9 million Chinese people use the Internet and just

14 percent of them regularly make Internet purchases, according to the China

Internet Network Information Center.

E-commerce has raised concerns among tax experts because it can extend

the reach of businesses beyond borders.