The Framework endorses the following principles for taxation of e-commerce:

"Neutrality
(i) Taxation should seek to be neutral and equitable between forms of electronic commerce and between conventional and electronic forms of commerce. Business decisions should be motivated by economic rather than tax considerations. Taxpayers in similar situations carrying out similar transactions should be subject to similar levels of taxation.

"Efficiency
(ii) Compliance costs for taxpayers and administrative costs for the tax authorities should be minimised as far as possible.

"Certainty and simplicity
(iii) The tax rules should be clear and simple to understand so that taxpayers can anticipate the tax consequences in advance of a transaction, including knowing when, where and how the tax is to be accounted.

"Effectiveness and Fairness
(iv) Taxation should produce the right amount of tax at the right time. The potential for tax evasion and avoidance should be minimised while keeping counter-acting measures proportionate to the risks involved."

By setting out these basic principles for taxation of e-commerce, OECD governments have agreed to the starting point for any future negotiations on this subject.