Spain Determined to Cash in on Digital Services Tax June 18, 2021 Spain's digital services tax levies a 3 percent tax on revenues from online ads, deals brokered on digital platforms, and sales of user data by tech companies with at least €750 million (US $893 million) in total annual worldwide revenues and Spanish revenues of €3 million ($3.57 million).
States Consider Digital Taxes Amidst Conflicting Rationales May 10, 2021 Digital advertising, social media, and data tax proposals have been introduced in nine states following enactment of Maryland’s digital advertising tax, which has since been postponed a year due to administrative and legal challenges.
Brits to Prepare for Tax Reforms February 22, 2021 Tax hikes or spending cuts implemented early in the year might undermine the desirable rapid recovery of the economy. The UK should focus on implementing tax reforms that have the potential to stimulate economic recovery by supporting business investment and employment while increasing its international tax competitiveness.
Maryland’s Digital Advertising Tax Is Unworkably Vague February 10, 2021 In addition to its economic impact on Maryland businesses and the likelihood of serious legal challenges, Maryland’s proposed digital advertising tax is incredibly vague on vital definitions, creating uncertainty about where revenue is sourced and when it is subject to the tax.
The European Commission and the Taxation of the Digital Economy February 4, 2021 The consultation on the EU’s digital levy provides an opportunity for policymakers and taxpayers to reflect on the underlying issues of digital taxation and potential consequences from a digital levy. Unless the EU digital levy is designed with an OECD agreement in mind, it is likely to cause more uncertainty in cross-border tax policy.
Digital Tax Collection Triggers New U.S. Tariffs on France January 6, 2021 A multilateral solution to digital taxation would be preferable over DSTs and retaliatory measures, especially during these challenging economic times. DSTs are indeed distortionary taxes that can act as trade barriers. Retaliatory tariffs, however, only further weaken the U.S.-French trade relationship and will negatively impact both economies.
The UN Approach on Digital Taxation October 22, 2020 The UN tax committee will be considering a change to the UN’s model tax treaty that, if adopted and implemented, could result in digital companies paying more taxes in countries where their customers are located even if those companies do not have physical locations there.
Two Roads Diverge in the OECD’s Impact Assessment October 20, 2020 The difference that the OECD presents between the potential impact in the context of agreement compared to a harmful tax and trade war should show policymakers the value of continuing multilateral discussions.
Pillars, Blueprints, an Impact Assessment, and Construction Delays October 13, 2020 The OECD released blueprints for proposals on changing international tax rules alongside an impact assessment based on the overall design of the proposals. While the blueprints cover proposals both for changing where large multinationals owe corporate tax and designing a global minimum tax, there are still many unanswered questions. In the meantime, other digital tax proposals are moving forward and have the potential to result in a harmful tax and trade war.
Where Should the Money Come From? August 12, 2020 The fiscal response to the COVID-19 pandemic will require policymakers to consider what revenue resources should be used to fill budget gaps. Tax policy experts have proposed wealth taxes, (global) corporate minimum taxes, excess profits taxes, and digital taxes as opportunities for governments to raise new revenues.
Who will Ultimately Pay the Digital Services Tax in the UK? Amazon Passes the Cost Along to Sellers August 4, 2020 When developing tax policy, lawmakers often ignore the incidence of a tax, or who actually pays the tax. Many times, this is different from who is legally required to pay the tax. Just because a 2 percent revenue tax applies to large digital companies does not mean that the companies will bear the entire cost of the tax.
The New EU Budget is Light on Details of Tax Proposals July 22, 2020 The European Council recently agreed on a new multiannual budget and a recovery program, which sets EU budget levels for 2021-2027 totals €1 trillion (US $1.2 trillion). The lack of details on the various tax proposals and the eventual need for revenue sources to finance new EU debt mean there is a lot of work left for policymakers in Brussels to do.
Tax Foundation Comments on the Initiation of Section 301 Investigations of Digital Services Taxes July 9, 2020 Digital services taxes effectively ring-fence the digital economy by limiting the tax to certain revenue streams of digital businesses, discriminating in favor of more traditional sectors of the economy.
Digital Tax Deadlock: Where Do We Go from Here? July 1, 2020 We recently hosted an exclusive webinar discussion to get up to speed on recent digital tax developments and gain insight from leading international tax experts on the OECD's BEPS project.
A Blow to Pillar 1 June 17, 2020 The U.S. has called for a pause in global digital tax negotiations, dealing a blow to Pillar 1 of the OECD's international tax project. What happens next could be very harmful for the global economy.
Watch: Taxing the Digital Economy June 3, 2020 What changed in the global economy that disrupted traditional means of taxation? Is it worth finding a way to include tax digital goods and services in the tax base? Why are digital services taxes so problematic? Are there better options—ways to adapt our current system without introducing complex and economically harmful policies?
The U.S. Trade Representative Expands Its Digital Services Tax Investigations June 2, 2020 The U.S. Trade Representative (USTR) expanded its digital service tax investigations, announcing Section 301 investigations into digital tax policies in nine countries and the European Union. The announcement follows an investigation of the French digital services tax that was completed in 2019, after which the USTR threatened significant #tariffs in retaliation against France.
New York Lawmakers Float New Data Tax Proposal June 2, 2020 Taxes on digital services, digital advertising, and the sale or utilization of consumer data, which were already emerging before the #coronavirus crisis, look increasingly attractive to cash-strapped states and localities.
Digital Taxation Around the World May 27, 2020 The digitalization of the economy has been a key focus of tax debates in recent years. Our new report reviews digital tax policies around the world with a focus on OECD countries, explores the various flaws and benefits associated with the wide set of proposals, and provides recommendations for lawmakers to consider.
Digital Services Taxes: Do They Comply with International Tax, Trade, and EU Law? May 26, 2020 A digital services tax like the one implemented by France likely violates both the General Agreement on Trade in Services and a model U.S. free trade agreement. However, it is uncertain whether meaningful relief could be obtained under either regime.
Gov. Hogan Vetoes Maryland Digital Advertising Tax Legislation May 7, 2020 Gov. Hogan vetoed a proposed first-in-the-nation digital advertising tax that would have imposed rates of up to 10 percent on digital advertising served to Marylanders.
Chaos to the Left of Me. Chaos to the Right of me. May 5, 2020 The OECD recently announced that the negotiation timeline for new digital tax proposals has now been pushed back to October due to the COVID-19 pandemic, although the end-of-year deadline for the overall project is still in place.
Tax Policy After Coronavirus: Clearing a Path to Economic Recovery April 22, 2020 Governments at all levels must work to remove the tax policy barriers that stand in the way of economic recovery and long-term prosperity following the COVID-19 crisis. Our new guide outlines several comprehensive options that policymakers can take at the federal and state levels.
Is Now the Time for a $100 billion Tax Increase? April 13, 2020 Seemingly unconcerned about how the digital project could impact the economy at this crisis moment, officials at the OECD recently released a statement boasting that they are continuing to work “full steam” on their global digital tax project.
India Pushes Digital Taxes in a Difficult Time March 26, 2020 Even during the coronavirus outbreak, efforts to change the way digital business models are taxed continue. India announced this week that its tax aimed at foreign digital companies, the “equalization levy,” will be expanded.
Worse Than Advertised: The Legal and Economic Pitfalls of Maryland’s Digital Advertising Tax March 16, 2020
Maryland Lawmakers Provide No Solution to Central Issues with Digital Advertisement Tax March 11, 2020
Maryland Legislature Seeks Revenue with Risky Proposals February 26, 2020 One notable consequence of high state tobacco excise tax rates is increased smuggling as people procure discounted products from low-tax states and sell them in high-tax states. Smugglers wouldn’t have to look far to find cheaper smokes. All of Maryland’s neighboring states have rates lower than $4 per pack, including Virginia ($1.20) and West Virginia ($0.30). Such an increase would impact the many small business owners operating vape shops around the state and convenience stores relying heavily on vapers as well as tobacco sales.
FAQ on Digital Services Taxes and the OECD’s BEPS Project January 30, 2020 What is a digital services tax (DST)? What countries have announced, proposed, or implemented a DST? What are some of the criticisms of a DST? What are alternatives to a DST? What is the OECD BEPS project and what is its main objective? What is the main objective of OECD Pillar 1? What is the main objective of OECD Pillar 2?
What European OECD Countries Are Doing about Digital Services Taxes March 25, 2021 Despite ongoing multilateral negotiations in the OECD, about half of all European OECD countries have either announced, proposed, or implemented their own unilateral digital services tax.
The Davos Digital (Tax) Détente? January 23, 2020 The past week has been nearly nonstop with news on various fronts of a dispute over taxation of digital businesses. The main characters have been the U.S., France, and the UK, although the EU and the OECD have also played roles. Though the dust is still settling, it is worth trying to tie the various events and arguments together.
Trump Administration Proposes Retaliatory Tariffs against France’s Digital Services Tax December 3, 2019
Tax Foundation Response to OECD Public Consultation Document: Global Anti-Base Erosion Proposal (“GloBE”) (Pillar Two) December 2, 2019 The tax base for the income-inclusion rule will be just as important as determining the rate, and both the base and the rate will likely impact business decisions. Additionally, policymakers need to determine how the choice for blending fits with the overarching goal of the policy. And as the example of GILTI shows, it is essential to assess how current international tax regulations would interact with a global minimum tax.
Response to OECD Public Consultation Document: Secretariat Proposal for a “Unified Approach” under Pillar One November 11, 2019 Unifying the proposal under sound principles in the context of clear economic analysis should allow the Inclusive Framework to minimize both the administrative and economic burdens that the Secretariat’s proposal could create.
The ABCs of the OECD Secretariat’s Unified Approach on Pillar 1 October 24, 2019 If there is double taxation due to digital services taxes or because a country is unwilling to conform to the structure of the Secretariat’s proposal, the impact would be a net negative for many businesses.
Amazon Passes France’s Digital Services Tax on to Vendors August 6, 2019 France's new 3 percent digital tax may be targeted at Amazon and other large digital firms, but Amazon’s French vendors will bear the burden of the tax.
Tax Foundation Response to OECD Public Consultation Document: Addressing the Tax Challenges of the Digitalization of the Economy March 4, 2019 Though the challenges to international tax policy are many, the OECD has a chance to work toward a system that creates fewer distortions and negative economic effects than the current one. However, given the policies on the table, it will certainly take quite an effort to avoid further complexity of international tax rules that creates challenges to global trade and economic prosperity.
New Study Debunks European Commission Claims Justifying New Taxes on Digital Companies March 19, 2018
States Consider Digital Taxes Amidst Conflicting Rationales May 10, 2021 Digital advertising, social media, and data tax proposals have been introduced in nine states following enactment of Maryland’s digital advertising tax, which has since been postponed a year due to administrative and legal challenges.
Maryland’s Digital Advertising Tax Is Unworkably Vague February 10, 2021 In addition to its economic impact on Maryland businesses and the likelihood of serious legal challenges, Maryland’s proposed digital advertising tax is incredibly vague on vital definitions, creating uncertainty about where revenue is sourced and when it is subject to the tax.
Digital Tax Collection Triggers New U.S. Tariffs on France January 6, 2021 A multilateral solution to digital taxation would be preferable over DSTs and retaliatory measures, especially during these challenging economic times. DSTs are indeed distortionary taxes that can act as trade barriers. Retaliatory tariffs, however, only further weaken the U.S.-French trade relationship and will negatively impact both economies.
Tax Foundation Comments on the Initiation of Section 301 Investigations of Digital Services Taxes July 9, 2020 Digital services taxes effectively ring-fence the digital economy by limiting the tax to certain revenue streams of digital businesses, discriminating in favor of more traditional sectors of the economy.
Digital Tax Deadlock: Where Do We Go from Here? July 1, 2020 We recently hosted an exclusive webinar discussion to get up to speed on recent digital tax developments and gain insight from leading international tax experts on the OECD's BEPS project.
A Blow to Pillar 1 June 17, 2020 The U.S. has called for a pause in global digital tax negotiations, dealing a blow to Pillar 1 of the OECD's international tax project. What happens next could be very harmful for the global economy.
The U.S. Trade Representative Expands Its Digital Services Tax Investigations June 2, 2020 The U.S. Trade Representative (USTR) expanded its digital service tax investigations, announcing Section 301 investigations into digital tax policies in nine countries and the European Union. The announcement follows an investigation of the French digital services tax that was completed in 2019, after which the USTR threatened significant #tariffs in retaliation against France.
New York Lawmakers Float New Data Tax Proposal June 2, 2020 Taxes on digital services, digital advertising, and the sale or utilization of consumer data, which were already emerging before the #coronavirus crisis, look increasingly attractive to cash-strapped states and localities.
Digital Taxation Around the World May 27, 2020 The digitalization of the economy has been a key focus of tax debates in recent years. Our new report reviews digital tax policies around the world with a focus on OECD countries, explores the various flaws and benefits associated with the wide set of proposals, and provides recommendations for lawmakers to consider.
Digital Services Taxes: Do They Comply with International Tax, Trade, and EU Law? May 26, 2020 A digital services tax like the one implemented by France likely violates both the General Agreement on Trade in Services and a model U.S. free trade agreement. However, it is uncertain whether meaningful relief could be obtained under either regime.
Gov. Hogan Vetoes Maryland Digital Advertising Tax Legislation May 7, 2020 Gov. Hogan vetoed a proposed first-in-the-nation digital advertising tax that would have imposed rates of up to 10 percent on digital advertising served to Marylanders.
Worse Than Advertised: The Legal and Economic Pitfalls of Maryland’s Digital Advertising Tax March 16, 2020
Maryland Lawmakers Provide No Solution to Central Issues with Digital Advertisement Tax March 11, 2020
Maryland Legislature Seeks Revenue with Risky Proposals February 26, 2020 One notable consequence of high state tobacco excise tax rates is increased smuggling as people procure discounted products from low-tax states and sell them in high-tax states. Smugglers wouldn’t have to look far to find cheaper smokes. All of Maryland’s neighboring states have rates lower than $4 per pack, including Virginia ($1.20) and West Virginia ($0.30). Such an increase would impact the many small business owners operating vape shops around the state and convenience stores relying heavily on vapers as well as tobacco sales.
Spain Determined to Cash in on Digital Services Tax June 18, 2021 Spain's digital services tax levies a 3 percent tax on revenues from online ads, deals brokered on digital platforms, and sales of user data by tech companies with at least €750 million (US $893 million) in total annual worldwide revenues and Spanish revenues of €3 million ($3.57 million).
Brits to Prepare for Tax Reforms February 22, 2021 Tax hikes or spending cuts implemented early in the year might undermine the desirable rapid recovery of the economy. The UK should focus on implementing tax reforms that have the potential to stimulate economic recovery by supporting business investment and employment while increasing its international tax competitiveness.
Who will Ultimately Pay the Digital Services Tax in the UK? Amazon Passes the Cost Along to Sellers August 4, 2020 When developing tax policy, lawmakers often ignore the incidence of a tax, or who actually pays the tax. Many times, this is different from who is legally required to pay the tax. Just because a 2 percent revenue tax applies to large digital companies does not mean that the companies will bear the entire cost of the tax.
Tax Foundation Comments on the Initiation of Section 301 Investigations of Digital Services Taxes July 9, 2020 Digital services taxes effectively ring-fence the digital economy by limiting the tax to certain revenue streams of digital businesses, discriminating in favor of more traditional sectors of the economy.
Digital Tax Deadlock: Where Do We Go from Here? July 1, 2020 We recently hosted an exclusive webinar discussion to get up to speed on recent digital tax developments and gain insight from leading international tax experts on the OECD's BEPS project.
Watch: Taxing the Digital Economy June 3, 2020 What changed in the global economy that disrupted traditional means of taxation? Is it worth finding a way to include tax digital goods and services in the tax base? Why are digital services taxes so problematic? Are there better options—ways to adapt our current system without introducing complex and economically harmful policies?
Digital Taxation Around the World May 27, 2020 The digitalization of the economy has been a key focus of tax debates in recent years. Our new report reviews digital tax policies around the world with a focus on OECD countries, explores the various flaws and benefits associated with the wide set of proposals, and provides recommendations for lawmakers to consider.
Digital Services Taxes: Do They Comply with International Tax, Trade, and EU Law? May 26, 2020 A digital services tax like the one implemented by France likely violates both the General Agreement on Trade in Services and a model U.S. free trade agreement. However, it is uncertain whether meaningful relief could be obtained under either regime.
India Pushes Digital Taxes in a Difficult Time March 26, 2020 Even during the coronavirus outbreak, efforts to change the way digital business models are taxed continue. India announced this week that its tax aimed at foreign digital companies, the “equalization levy,” will be expanded.
What European OECD Countries Are Doing about Digital Services Taxes March 25, 2021 Despite ongoing multilateral negotiations in the OECD, about half of all European OECD countries have either announced, proposed, or implemented their own unilateral digital services tax.
The Davos Digital (Tax) Détente? January 23, 2020 The past week has been nearly nonstop with news on various fronts of a dispute over taxation of digital businesses. The main characters have been the U.S., France, and the UK, although the EU and the OECD have also played roles. Though the dust is still settling, it is worth trying to tie the various events and arguments together.
Trump Administration Proposes Retaliatory Tariffs against France’s Digital Services Tax December 3, 2019
Amazon Passes France’s Digital Services Tax on to Vendors August 6, 2019 France's new 3 percent digital tax may be targeted at Amazon and other large digital firms, but Amazon’s French vendors will bear the burden of the tax.
The European Commission and the Taxation of the Digital Economy February 4, 2021 The consultation on the EU’s digital levy provides an opportunity for policymakers and taxpayers to reflect on the underlying issues of digital taxation and potential consequences from a digital levy. Unless the EU digital levy is designed with an OECD agreement in mind, it is likely to cause more uncertainty in cross-border tax policy.
The UN Approach on Digital Taxation October 22, 2020 The UN tax committee will be considering a change to the UN’s model tax treaty that, if adopted and implemented, could result in digital companies paying more taxes in countries where their customers are located even if those companies do not have physical locations there.
Two Roads Diverge in the OECD’s Impact Assessment October 20, 2020 The difference that the OECD presents between the potential impact in the context of agreement compared to a harmful tax and trade war should show policymakers the value of continuing multilateral discussions.
Pillars, Blueprints, an Impact Assessment, and Construction Delays October 13, 2020 The OECD released blueprints for proposals on changing international tax rules alongside an impact assessment based on the overall design of the proposals. While the blueprints cover proposals both for changing where large multinationals owe corporate tax and designing a global minimum tax, there are still many unanswered questions. In the meantime, other digital tax proposals are moving forward and have the potential to result in a harmful tax and trade war.
Where Should the Money Come From? August 12, 2020 The fiscal response to the COVID-19 pandemic will require policymakers to consider what revenue resources should be used to fill budget gaps. Tax policy experts have proposed wealth taxes, (global) corporate minimum taxes, excess profits taxes, and digital taxes as opportunities for governments to raise new revenues.
The New EU Budget is Light on Details of Tax Proposals July 22, 2020 The European Council recently agreed on a new multiannual budget and a recovery program, which sets EU budget levels for 2021-2027 totals €1 trillion (US $1.2 trillion). The lack of details on the various tax proposals and the eventual need for revenue sources to finance new EU debt mean there is a lot of work left for policymakers in Brussels to do.
Tax Foundation Comments on the Initiation of Section 301 Investigations of Digital Services Taxes July 9, 2020 Digital services taxes effectively ring-fence the digital economy by limiting the tax to certain revenue streams of digital businesses, discriminating in favor of more traditional sectors of the economy.
Digital Tax Deadlock: Where Do We Go from Here? July 1, 2020 We recently hosted an exclusive webinar discussion to get up to speed on recent digital tax developments and gain insight from leading international tax experts on the OECD's BEPS project.
A Blow to Pillar 1 June 17, 2020 The U.S. has called for a pause in global digital tax negotiations, dealing a blow to Pillar 1 of the OECD's international tax project. What happens next could be very harmful for the global economy.
Watch: Taxing the Digital Economy June 3, 2020 What changed in the global economy that disrupted traditional means of taxation? Is it worth finding a way to include tax digital goods and services in the tax base? Why are digital services taxes so problematic? Are there better options—ways to adapt our current system without introducing complex and economically harmful policies?
Digital Taxation Around the World May 27, 2020 The digitalization of the economy has been a key focus of tax debates in recent years. Our new report reviews digital tax policies around the world with a focus on OECD countries, explores the various flaws and benefits associated with the wide set of proposals, and provides recommendations for lawmakers to consider.
Digital Services Taxes: Do They Comply with International Tax, Trade, and EU Law? May 26, 2020 A digital services tax like the one implemented by France likely violates both the General Agreement on Trade in Services and a model U.S. free trade agreement. However, it is uncertain whether meaningful relief could be obtained under either regime.
Chaos to the Left of Me. Chaos to the Right of me. May 5, 2020 The OECD recently announced that the negotiation timeline for new digital tax proposals has now been pushed back to October due to the COVID-19 pandemic, although the end-of-year deadline for the overall project is still in place.
Is Now the Time for a $100 billion Tax Increase? April 13, 2020 Seemingly unconcerned about how the digital project could impact the economy at this crisis moment, officials at the OECD recently released a statement boasting that they are continuing to work “full steam” on their global digital tax project.
FAQ on Digital Services Taxes and the OECD’s BEPS Project January 30, 2020 What is a digital services tax (DST)? What countries have announced, proposed, or implemented a DST? What are some of the criticisms of a DST? What are alternatives to a DST? What is the OECD BEPS project and what is its main objective? What is the main objective of OECD Pillar 1? What is the main objective of OECD Pillar 2?
What European OECD Countries Are Doing about Digital Services Taxes March 25, 2021 Despite ongoing multilateral negotiations in the OECD, about half of all European OECD countries have either announced, proposed, or implemented their own unilateral digital services tax.
The Davos Digital (Tax) Détente? January 23, 2020 The past week has been nearly nonstop with news on various fronts of a dispute over taxation of digital businesses. The main characters have been the U.S., France, and the UK, although the EU and the OECD have also played roles. Though the dust is still settling, it is worth trying to tie the various events and arguments together.
The ABCs of the OECD Secretariat’s Unified Approach on Pillar 1 October 24, 2019 If there is double taxation due to digital services taxes or because a country is unwilling to conform to the structure of the Secretariat’s proposal, the impact would be a net negative for many businesses.
New Study Debunks European Commission Claims Justifying New Taxes on Digital Companies March 19, 2018
Tax Foundation Comments on the Initiation of Section 301 Investigations of Digital Services Taxes July 9, 2020 Digital services taxes effectively ring-fence the digital economy by limiting the tax to certain revenue streams of digital businesses, discriminating in favor of more traditional sectors of the economy.
Tax Policy After Coronavirus: Clearing a Path to Economic Recovery April 22, 2020 Governments at all levels must work to remove the tax policy barriers that stand in the way of economic recovery and long-term prosperity following the COVID-19 crisis. Our new guide outlines several comprehensive options that policymakers can take at the federal and state levels.
Tax Foundation Response to OECD Public Consultation Document: Global Anti-Base Erosion Proposal (“GloBE”) (Pillar Two) December 2, 2019 The tax base for the income-inclusion rule will be just as important as determining the rate, and both the base and the rate will likely impact business decisions. Additionally, policymakers need to determine how the choice for blending fits with the overarching goal of the policy. And as the example of GILTI shows, it is essential to assess how current international tax regulations would interact with a global minimum tax.
Response to OECD Public Consultation Document: Secretariat Proposal for a “Unified Approach” under Pillar One November 11, 2019 Unifying the proposal under sound principles in the context of clear economic analysis should allow the Inclusive Framework to minimize both the administrative and economic burdens that the Secretariat’s proposal could create.
Tax Foundation Response to OECD Public Consultation Document: Addressing the Tax Challenges of the Digitalization of the Economy March 4, 2019 Though the challenges to international tax policy are many, the OECD has a chance to work toward a system that creates fewer distortions and negative economic effects than the current one. However, given the policies on the table, it will certainly take quite an effort to avoid further complexity of international tax rules that creates challenges to global trade and economic prosperity.
