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JILT 1999 (2) - Peter Kangis 1

R Doernberg and L Hinnekens

Electronic Commerce and International Taxation

Kluwer Law International(1999) GBP 59.50
320pp ISBN 90-4111-053-4

Reviewed by
Dr Peter Kangis
Deputy Director
Sems-University of Surrey





Technology Changes


International Tax Rules


Policy Proposals




1. Introduction

Although this book is published by Kluwer and authored by Doernberg and Hinnekens, it was motivated and sponsored by the International Fiscal Association which has been considering how the advent of the internet is likely to impact on international tax rules, both those located in national law and those found in or resulting from various tax treaties. The first part of the book, over some 45 pages, revisits the traditional international tax rules. Separate sections cover direct, income based taxation and VAT and sales tax. The bases of jurisdiction and domicile are considered with specific attention to situations where double taxation may arise and the relief available. The section on VAT and sales tax would be of greater interest to those concerned with the European Community than others.

2. Technology Changes

The second part of the book, in close to 60 pages, describes some of the changes in technology, facilitating the introduction and subsequent expansion of electronic commerce. The language used is simple and yet the treatment of the subject is sound and fairly comprehensive for an introductory text. It could be argued, however, that the pace of change and progress of information technology is likely to render this part out of date, other than for its historical perspective. Since the same pace of obsolescence is likely to attach to the first part of the book, particularly where it relates exclusively to the European Community, it could be argued that some 100 pages of text have been devoted to the past. If, however, 'a page of history is a volume of logic', then the contextual and historical factors may have a contribution to make.

3. International Tax Rules

In the third part of the book, over some 200 pages, the authors endeavour to apply the present (at the time of writing) international tax rules to electronic commerce with a view to identifying key issues that need to be addressed. This is done thoroughly and comprehensively. Description, evidence and analysis form a consistent pattern, helping to add authority to what is being said. Emphasis is placed on sales, residence, transfer pricing, electronic commerce; a short comparison is then made between the systems prevailing in the European Community and those in a handful of other jurisdictions, even though the choosing of the specific jurisdictions does not appear sufficiently well justified, even after repeated reading.

4. Policy Proposals

The fourth part of the book aims to draw conclusions from the preceding analysis and comes up with proposals. Regrettably, although the analysis was sound, the conclusions presented as policy proposals are articulated in what comes across as a rather disjointed manner, which makes it difficult for the reader to identify the unifying force of the argument. Yes, there is a lot to be done in terms of taxation and a lot to learn about electronic commerce, surely the authors could have used the 70 pages to come up with a clearer message?

The final part of the book is a Precis authored by Jean-Pierre le Gall, which is based on some of the comments made to the contents and proposals in this book, by a number of representatives from national branches of the International Fiscal Association. There is evidence of wide divergence in views as to what the position is at present and what steps should be taken in fiscal matters relating to the use of the internet for commercial purposes. There was consensus, however, that electronic commerce is a 'tremendous perturbation' of the theory and practice of taxation as it is understood to exist.

5. Conclusion

The book represents an attempt to bring together the various facts and forces relating to the internet and to electronic commerce and to raise questions about the implications for taxation. The descriptive and analytical parts were undertaken with care; the inductive parts, leading to solutions, should have been written with better structure and thematic consistency. More importantly, the word 'Europe' should have appeared in some shape or form in the title since the international considerations do not form a substantial part of what has been undertaken. The reviewer would have appreciated a glossary, a keyword/acronym index and a list of relevant texts.

This is a Book Review published on 30 June 1999.

Citation: Kangis P, 'Electronic Commerce and International Taxation', Book Review, 1999 (2) The Journal of Information, Law and Technology (JILT). <>. New citation as at 1/1/04: <>

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