/ 27 July 1999

Govt to tax e-commerce deals?

BARRY STREEK, Cape Town | Tuesday 5.45pm.

THE next stage in drafting an e-commerce policy for South Africa will be taken on Thursday when Communications Minister Ivy Matsepe-Casaburri, releases a discussion paper on electronic commerce.

The paper, based on a report by a task group and research by various government departments and agencies, will after debate and discussion lead to a green paper, a white paper of government policy on electronic commerce and then legislation, scheduled for the first quarter of 2001.

The task group has identified four main Needs — the need for confidence in the security and privacy of transactions performed electronically, the need to enhance information infrastructure, the need to establish rules that would govern electronic commerce and the need to bring the opportunities of e-commerce to the entire population.

In its report, the task group identifies the building of trust as a key feature of e-commerce policy to help overcome real and perceived risks to businesses and consumers that could arise in electronic transactions.

This includes ensuring the privacy of personal data collected in the course of electronic transactions.

Another key issue is the proposed policies which will define the common rules and practices for electronic commerce on national and international levels. This includes the issue of tax on cyberspace deals.

The United States has already abolished tax on e-commerce deals but the task group merely looked at whether the government should consider or prohibit specialized new taxes or duties on electronic transmissions of data.

The task group also looked at how e-commerce will impact on the transition of the South African economy. It concluded that marginalised people who previously were considered “unbankable” could, through e-commerce and cheap infrastructure, dramatically expand the market, but it warned that e-commerce could work against the need for equity, leaving the marginalised further behind whilst the “haves” continued to rush ahead.

As part of the discussion process, Matsepe-Casaburri will launch a new website on Thursday. Its address is: www.ecom-debate.co.za.