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Of course, this will only be scatching leading. This entire article is actually definitely an over-simplification of a very complex subject. You'll need professional advice that will help you through E-Commerce Taxland.

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The rationale behind this follows: Since countries can't collect sales tax on Internet transactions at their borders, the sole method they can collect it (other when compared to a self-assessment system) is with an online sales tax. Further, it is claimed that companies in the european countries suffer an international competitive disadvantage because they should be collect Value added tax (VAT) but others may not.