Journal of Applied Finance & Banking

A Study on Taxation of Cross-Border E-Commerce Transactions: The Case of Value-Added Tax

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• Abstract

   

  This paper examines the taxation of cross-border e-commerce (CBEC) in Taiwan with a focus on the Value-Added Tax (VAT) regime. It analyzes Taiwan’s legal reforms requiring foreign digital service providers to register and remit VAT, and evaluates the effectiveness of these measures through comparative analysis and case studies, including Uber and LINE. The study highlights administrative gaps such as limited audit capabilities and lack of international cooperation, and compares Taiwan's system with those in the EU, South Korea, and Australia. Based on recent global practices, the paper proposes policy recommendations to enhance tax neutrality, enforcement efficiency, and digital infrastructure. The findings contribute to ongoing efforts to align national tax systems with the digital economy’s borderless nature.

   

  JEL classification numbers: H25, H26.

  Keywords: Cross-border e-commerce, Value-Added Tax, Digital Economy, Tax Compliance.