Chapter: 11 (E-Commerce) 1.___________ is the process of transferring payment from the buyer's bank account to the seller's bank account. 2.Banks / financial institutions need authorization from _______ to establish EFT systems.

3.Operating an EFT system without authorization is a crime under the ________(for conventional banks) and _______(for Islamic banks). 4.Secure Electronic Transaction (SET) specification created by credit card companies uses digital signature, therefore it is in line with the _____ Act. 5.______ of e-commerce transactions can create challenges because of determining the location of the e-commerce business. This will relate to which law to follow. E-commerce can operate globally. Also, e-commerce can be operated without a physical company / office (just need to host at the server). Laws are not the same in each country, therefore we need to determine which country will the e-commerce business have to pay tax to. 6.The _____ may choose to operate / host their website in countries which has low or no taxes. 7.The _____ could be taxed by the government when they buy something, but it is difficult to monitor every purchase, especially if it is something that can be delivered over the Internet (i.e. can be downloaded). So proper taxation measures must be put in place. 8.OECD guideline on taxation overcomes this problem by putting in the requirement of ______ that will determine in which country the company has to pay taxes. 9.________ is not considered 'permanent establishment'.

Malaysian context: 1) Income Tax Act Any person or company (including non-Malaysian) that get their income in Malaysia must pay income tax to the _______ government. Two elements under the Act to impose tax on foreign company: a) b)

2) Sales Tax Act 2018 & Service Tax Act 2018 These laws impose tax on any goods or services that are not ______from the two taxes. Sales tax is imposed on the _____ at 10%. Normally they will include this in their selling price to the distributor. Service tax is imposed on the _____ at 6%. Normally they will include this in their selling price to the consumer. The requirement is the companies must be registered and ____ business in Malaysia in order for them to pay tax to the Malaysian government.