Abstract: Cyberspace is a virtual trading shop, from where income is generated, sale and purchase are transacted, service to clients and entertainment and luxuries to the customers are offered. Considering the enormous scope for commercial activities, it can be a meadow of taxation giving a wider scope to the State to generate public revenue. Introduction: Tax is a mandatory imposition by the sovereign without any guarantee of special benefits. The imposition of tax is a constitutional function. Such an imposition may be either upon person or property or privileges or occupations or enjoyments of the people. Obviously, the primary implication and object of taxation is to raise money for the purpose of the Government, by means of contribution from individual persons. While levying a tax, the State, to some extent, brings in measures to regulate the business activity or the consumption of a commodity or service or even accumulation of wealth in the ...