A paper from the European Centre for International Political Economy (ECIPE) says that, since 1998, WTO member states have applied a moratorium against tariffs on international electronic transmissions (commonly referred to as the WTO ‘E-Commerce’ Moratorium). However, some WTO member states have recently debated whether the moratorium remains in their economic interest, given the potential revenues that might be generated by imposing tariffs on electronic transmissions. The study examines the impact on India, Indonesia, South Africa and China (and the general case for developing countries) and concludes that imposing such tariffs would be fiscally counter-productive. It says that research shows that if countries ceased to uphold the moratorium and levied import duties on digital goods and services, they would suffer negative economic consequences in the form of higher prices and reduced consumption, which would in turn slow GDP growth and shrink tax revenues.
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