>If I surf over to another (Internet surfing) country because the server is physically located in that country, I again am forced to follow the laws that apply there.
on the other hand if you go set up a business that sells to citizens of that other country do you have to follow rules to be allowed to sell stuff there? You see how the analogy is a little closer aligned?
Not really.
For Example, I setup a business on the Oregon side of the Portland, Oregon / Vancouver, Washington border. Oregon doesn't have a sales tax, should I have to pay Washington sales tax because I had someone buy something from my shop in Oregon?
Same kind of deal, omg.lol have my servers located in the United States, payment processing happens in the United States, in United States Dollars. In no way is omg.lol making a special usecase to handle European customers.
Now, Europe is free to attempt to excise their laws againt omg.lol, however they wouldn't get much further than "you're blocked in the EU" and having to get ISPs and transit networks to blocke their traffic, and payment networks to stop serving EU customers for that particular merchant ID.
If you ever run an ecommerce business, the expectation is absolutely that you pay taxes to foreign governments in compliance with their rules for any customers in their jurisdiction.
Is this usually followed in small scale shops? Almost never in my experience, though if the shop gets big enough or if the business is sold those tax liabilities are still technically owed. Many countries do have a minimum revenue before you have to pay taxes, and some have a minimum before you're supposed to report sales via tax filings even if you don't owe, but you better keep the operation small if you never plan to pay foreign sales tax.
on the other hand if you go set up a business that sells to citizens of that other country do you have to follow rules to be allowed to sell stuff there? You see how the analogy is a little closer aligned?