E-Commerce Tax Compliance In Pakistan

Abstract

The emergence of 21^st century is the age of knowledge and the age of economy where the threshold of innovation and new ideas is stronger than wealth. This era of knowledge economy came up with multiverse ideas hitting almost all the fields. Internet changed the conventional business methods and introduced new and innovative ways of transacting business online. E-commerce includes selling of goods and services via internet. E-commerce opened a new platform for conventional businesses as well as entrepreneurs and SMEs. As much as this sector needs galvanization, there is also a need of comprehensive policy for collecting taxes from E-commerce sector. As it is a growing platform, and it has not reached its full growth potential there is a need of harmonized policy that will encourage new businesses to engage and then comply with tax collection mechanism to grow Pakistan both technologically and economically. There is a dire need of incorporating the E-commerce industry in the mainstream tax compliance and give amenities to boost confidence in this new platform which will be lucrative in the future. Encouraging and facilitating E-commerce industry and protecting consumer rights by incorporating E-commerce businesses in the government system via registrations is inevitable as conventional rules cannot be applied to make E-commerce industry comply with the tax requirements.