New Challenges in the Taxation of a Digital Economy, SA vs FA.
(2019) Réunion annuelle de l’International Institute of Public Finance — Location: Glasgow, Scotland (21.August.2019)
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- Abstract
- Although digitalization is a key driver of the economy, it creates new challenges for the international tax system, like distortions between digital and traditional businesses and erosion of tax revenues. Since digital economy may not be ring-fenced, that calls for reforms. Our contribution aims at better understanding digital economy and tax-related issues. More specifically, from a careful examination of literature on two-sided markets, including arm’s length principle, separate accounting, formulary apportionment and data factor, we derive conclusions that we further discuss. The economy has evolved at a fast pace with digital business models expected to arise quickly. However, the international tax system seems outdated before that new reality. Hence, its reform is now an urgent task should we ensure a fair and efficient game on a playing field where digital business meets traditional economy.
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Luong, N., & Gérard, M. (2019). New Challenges in the Taxation of a Digital Economy, SA vs FA. Réunion annuelle de l’International Institute of Public Finance, Glasgow, Scotland. https://hdl.handle.net/2078.5/59544