Despite recent research predicting that e-commerce in China will be worth $12billion by 2004, many citizens currently lack essential tools for internet transactions including credit card facilities and computer access.
The Chinese government acknowledges that taxing the internet will be a complicated task and it has established a special tax force to deal with the issues arising. It is aware that the internet is an attractive medium for tax evasion especially as it is difficult to locate individual users.
The areas that potentially pose the greatest problems relate to cross-border transactions and intellectual property rights. Even so, the SAT remains determined to find a way to treat e-commerce taxation on a par with its current measures for traditional retailers.