383 
‘‘(b) IMPORT OF SERVICES.—A business entity shall 
be treated as importing a service if— 
‘‘(1) the entire benefit of the service will be re-
alized in the United States, and 
‘‘(2) the benefit will be realized in connection 
with the United States business activities of the 
business entity. 
‘‘(c) EXPORT
OF SERVICES.—A business will be 
treated as exporting a service if— 
‘‘(1) the entire benefit of the service will be re-
alized outside of the United States, and 
‘‘(2) the benefit will be realized solely in con-
nection with the activities of the purchaser occurring 
outside the United States. 
‘‘(d) SERVICES ACQUIRED FROM SERVICE PROVIDER 
THAT
PROVIDES
SERVICES
IN
AND
OUTSIDE
THE 
UNITED STATES.— 
‘‘(1) IN
GENERAL.—If a business entity ac-
quires services from a service provider that provides 
services both in and outside the United States and 
the service provider shows on the invoice where the 
services are provided— 
‘‘(A) the business entity shall treat the 
services as provided where stated on the invoice, 
and
384 
‘‘(B) the service provider shall treat as tax-
able receipts any services listed as provided in 
the United States. 
‘‘(2) NO INVOICE.—If a business entity acquires 
services from a service provider that provides serv-
ices both in and outside the United States and the 
service provider does not show on an invoice where 
such services are provided— 
‘‘(A) the business entity shall treat the 
services as if provided in the location to which 
payment is sent, and 
‘‘(B) the service provider shall treat as tax-
able receipts any payments received in the 
United States. 
‘‘(e) SPECIAL RULES PREVAIL.—See sections 268 
and 269 for special rule relating to transportation and 
communication services. 
‘‘SEC. 268. INTERNATIONAL TRANSPORTATION SERVICES. 
‘‘(a) TRANSPORTATION OF PROPERTY.— 
‘‘(1) TAXABLE RECEIPTS.— 
‘‘(A) EXPORTS.—Taxable receipts do not 
include receipts from the transportation of 
property exported from the United States. 
‘‘(B) IMPORTS.—Taxable receipts include 
receipts from transportation of property im-
385 
ported into the United States only if such costs 
are not taken into account in determining the 
import tax. 
‘‘(C) PRESUMPTIONS.—The Secretary shall 
prescribe regulations describing situations in 
which a transporter of property must presume 
that no import tax has been paid on the cost of 
its services. 
‘‘(2) BUSINESS PURCHASES.— 
‘‘(A) EXPORTS.—Business purchases do 
not include amounts paid or incurred for the 
cost of transportation of property exported from 
the United States. 
‘‘(B) IMPORTS.—Amounts paid or incurred 
for transportation of goods imported into the 
United States, shall constitute a cost of busi-
ness purchase only to the extent that they are 
taken into account in determining the customs 
value for purposes of section 286(a) (relating to 
the import tax). 
‘‘(b) TRANSPORTATION OF PASSENGERS.— 
‘‘(1) TAXABLE RECEIPTS.—Taxable receipts— 
‘‘(A) include receipts from the transpor-
tation of passengers from the United States to 
a destination outside the United States, but
386 
‘‘(B) do not include receipts from the 
transportation of passengers from outside the 
United States to a destination in the United 
States. 
‘‘(2) BUSINESS
PURCHASES.—Business pur-
chases— 
‘‘(A) include amounts paid or incurred in 
a business activity for the transportation of 
passengers from the United States to a destina-
tion outside the United States, but 
‘‘(B) do not include amounts paid or in-
curred for transportation of passengers from 
outside the United States to a destination in 
the United States. 
‘‘(3) SIMPLIFYING RULES.—The Secretary may 
provide rules that simplify this subsection, including 
rules under which— 
‘‘(A) half of receipts attributable to trans-
portation to or from the United States are 
treated as taxable receipts, 
‘‘(B) half of the cost for business trips to 
and from the United States are treated as busi-
ness purchases, and 
‘‘(C) all transportation expenses of a busi-
ness entity that has no regular business outside