ResearchPaper2 - Regulation of E-commerce Electronic...

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Regulation of E-commerce Electronic commerce is defined as any business conducted over the internet, whether it has a financial benefit or not. The e-commerce regulations that will be the primary focus of this section of the report are based on the benefits of regulation for the financial aspect of electronic business and if such businesses should be taxed either by their respective states or if tax fees should be the responsibility of the buyer. The focus will be primarily on the possible financial losses of individuals, in a mass market that is growing without signs of slowing down anytime soon, as stated in remarks prepared for the United States Commerce Secretary, “the Internet -- which analysts say is responsible for $10 trillion in annual online transactions – is a cornerstone of the global economy.”(Dir) With more and more shoppers turning to an online environment to satisfy their shopping needs, the growing threats of criminals, taking advantage of these electronic methods for transactions is inevitable. The individuals committing these frauds or crimes are effective at doing what they are designed to do, which is to take advantage of people who chose to shop online. Regulations will play an important role in how to approach the criminals and disputes in online transactions. The first portion of this section of the report will give various examples of what kind of regulations we will need to put in place in order to protect the growing number of individuals who do business online from the increase of internet frauds. These consumers represent a large portion of sales the U.S. as well as other countries with an estimated annual rate of 10 trillion dollars worldwide. (Dir) With this amount of money transacted electronically between consumers and businesses from sometimes thousands of miles away, between consumers and businesses, there is little doubt there will be a small percentage of people who will attempt to
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take advantage. These criminals are increasing in number and technical ability, therefore the success rate of the individuals committing these acts has grown accordingly. The question becomes how society will prevent businesses and/or individuals who attempt to do harm to consumers from succeeding and hold them responsible for their actions while keeping the advantages of electronic commerce. Finally, we will discuss taxing online transactions for online businesses. Online transactions are currently relatively tax-free; giving online retailers, what some could say an advantage that is not possible for a local establishment. This portion will also inspect the argument that taxes will prevent customers from making their purchases online. An online store is only required to collect state taxes from their customers who are making an online purchase from them, if they have a physical presence in a state. (Col) This is often referred to as a nexus. All states have different regulations as to what is considered to be a nexus, but all consider a
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This note was uploaded on 05/08/2011 for the course ECET 220 taught by Professor Smith during the Spring '11 term at DeVry Austin.

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ResearchPaper2 - Regulation of E-commerce Electronic...

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