Contents CERTIFICATE ; DECLARATION ; ACKNOWLEDGEMENT ; TABLE OF ABBREVIATION ; OECD/UN DOCUMENTS ; TABLE OF CASES ; CHAPTER ONE ; INTRODUCTION ; 1.1. Significance of the Study ; 1.2. Statement of the Problem ; 1.3. Objectives of the Study ; 1.4. Research Methodology ; Research Design ; Nature and Sources of Data ; 1.5. Hypothesis ; 1.6. Limitations of the Study ; 1.7. Literature Review ; 1.8. Organization of the Study ; CHAPTER TWO ; TAXATION AND ELECTRONIC COMMERCE ; 2.1. Basic Principles of Taxing Jurisdiction ; I. Source Based Taxation ; II. Residence Based Taxation ; III. Double Taxation ; 2.2. Permanent Establishment ; I. OECD Model Tax Convention ; II. UN Model Tax Convention ; 2.3. Electronic Commerce ; 2.4. Features of Electronic Commerce ; CHAPTER THREE ; TAX CHALLENGES OF ELECTRONIC COMMERCE ; 3.1. Challenges Recognized by the OECD BEPS Action Plan 1 ; I. Nexus and ability to have a significant presence without being liable to tax; II. Data and the attribution of value created from the generation of marketable location-relevant data through the use of digital products and services ; III. Characterization of income derived from new business models ; 3.2. Difficulty in Applying Residence Based Taxation ; 3.3. Difficulty in Applying Source Based Taxation ; 3.4. Difficulty in Categorization of Income ; 3.5. Difficulty of Categorizing and Taxing Digitized Online Goods and Intangible; 3.6. Difficulty in Taxation of Cross Border Online Services in E-commerce; 3.7. Enforcement and Administration Difficulties ; CHAPTER FOUR ; PERMANENT ESTABLISHMENT FOR THE PURPOSE OF ELECTRONIC COMMERCE ; 4.1. Server ; 4.2. Website . 4.3. Computer ; 4.4. Computer Reservation Services ; 4.5. Internet Service Provider ; CHPTER FIVE ; ADDRESSING TAX CHALLENGES OF ELECTRONIC COMMERCE ; 5.1. Recommendations in BEPS Action Plan 1 ; I. Modification to the exceptions from PE status ; II. Alternatives to the existing PE threshold ; III. Imposition of withholding tax on certain types of digital transactions; IV. Introduction of an equalization levy ; 5.2. Continuing the Current Mixture of Source and Residence Based Taxation 5.3. Switching to Residence Based Taxation ; 5.4. Introducing a New Internet Specific Tax ; 5.5. Base Erosion Approach ; 5.6. Virtual Permanent Establishment ; 5.7. Formulary Apportionment ; CHAPTER SIX ; CONCLUSION ; Bibliography .