[governance] Hmmmm... Google: "Internet Freedom!"... (from taxes?

[Salanieta T. Tamanikaiwaimaro]

On Tue, Dec 4, 2012 at 12:39 AM, Suresh Ramasubramanian
<suresh at hserus.net>wrote:

> Of course the tax dispute is not with the telecom regulators of those
> countries and would continue regardless of the outcome in the WCIT, so you
> will forgive me if I don't quite get the connection
>
> --srs (htc one x)


A few thoughts from me:

Well it not new that the US has always maintained that the Internet should
be a tax free zone as per the US Congress's Tax Freedom Act 1998 (*authored
by **Representative Christopher Cox and Senator Ron Wyden and signed into
law on October 21 1998 by then President Clinton*) which following expiry
continued to be reauthorised and it most recent reauthorisation (legal
speak for extension) was in October 2007 where this has been extended till
2014.

The OECD and the EU have been holding the opposite view (Kurbaliha,J. 2010)
- see their Ottawa Principles where they find that there is no difference
between traditional and e taxation that would require special regulations.

 It followed that in 2003 when the EU introduced a regulation requesting
non EU e commerce companies to pay value added tax (VAT) if they sold goods
within the EU. The main driver or motivation was that non-EU companies
(many of whom are US companies) had an edge over European companies. See
one of the Reports - http://www.oecd.org/tax/taxadministration/20499630.pdf

The point of controversy is also location (US is pro-origin) and
destination (EU is pro-destination) when assessing tarriffs so when take
for example as is with Trade.

This is why MNCs (multinational corporations) are careful and selective of
jurisdictions in which they plonk their servers in or offices in because it
has to make sense to the bottom line. In my view nothing wrong with the
bottom line as long as people behave responsibly and fairly so that global
public interest is protected. The only problem is that history and current
trends show that the self regulatory model does'nt work (see some of the
links that Michael provided). [question for us is finding that place of
balance where we can all win].

Why is South Korea so important in the mix? Well aside from the Samsung v
Apple and Apple v Samsung circus, South Korea also leads the world in terms
of being number 1 in the IDI ranking but if you peel the layers, volume and
content are massive triggers as far as generating revenue. Ask any ISP or
MNC...If taxation were introduced globally, the apple cart would be upset.
Of course, at the end of the day, the reality is that the EU is in
financial crisis and it should not come as a shock as to what their
position will be in terms of "enhancing stability". The fact that even the
IMF is struggling to find viable solutions shows that hourglass is in
motion.
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