Our experts are providing leading analysis of proposals to tax revenues from digital activities around the world. As several European countries and even U.S. states continue to work towards implementing digital services tax (DSTs) policies, the uncertainty for the firms affected by these taxes will continue to rise. The posts below review the evidence that has been gathered on the impact of digital services tax (DSTs) policies, including our responses to OECD Public Consultation Documents.
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.
12 min read
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.
7 min read
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.
9 min read
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.
26 min read
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.
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?
8 min read
Across the U.S., policymakers of both parties have developed a strong interest in taxing large technology companies through digital advertising taxes, social media taxes, and data taxes. Join Tax Foundation’s Daniel Bunn and Jared Walczak as they untangle the complex and sometimes contradictory world of state digital taxes.
If the U.S. is suggesting a 15 percent effective rate as the minimum acceptable rate for a global agreement, then the tax bases of the various minimum taxes adopted as part of the agreement should be aligned to minimize complexities and unintended consequences.
5 min read
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.
14 min read
As countries move closer to agreement on how the OECD Pillar 1 Amount A will work and which companies will be impacted by it, it is incredibly important for policymakers to continue to evaluate not just the intended effects but also the potential unintended consequences.
6 min read
Tax hikes implemented in the near term might undermine Spain’s economic recovery. Spain should focus on implementing tax reforms that have the potential to stimulate economic recovery by supporting private investment and employment while increasing its internal and international tax competitiveness.
5 min read
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.
4 min read
The Tax Foundation’s “State Tax Policy Boot Camp,” is ideal for anyone interested in gaining a better understanding of state taxation.
2 min read
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.
17 min read
The potential override of Gov. Larry Hogan’s (R) veto of a digital advertising tax (HB732) looms large over the current legislative session in Maryland, though it is only one of many tax proposals under consideration in the state.
7 min read
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.
12 min read
Over the last several years, policymakers in countries around the world have groped for new ways to tax e-commerce, social media, cloud-based, and other online businesses, in some cases stoking major international trade disputes in the process. In this episode of The Deduction, we explore the “digital services tax” (DST), one new and increasingly popular policy designed to address the digital economy.
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.
2 min read
Our new study provides a 360-degree assessment of New York’s budget crisis, analyzes proposed revenue options, and offers solutions to raise revenue without driving more taxpayers out of the state or undoing recent positive reforms
106 min read
While other countries in Europe are working towards introducing tax cuts and stimulating economic recovery by supporting business investment and employment, Spain is putting more fiscal pressure on households and businesses.
4 min read
Our new guide identifies key areas for improvement in UK tax policy and provides recommendations that would support long-term growth without putting a dent in government revenues.
24 min read
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.
5 min read
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.
6 min read
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.
4 min read
Spain’s upper house passed two major tax bills today: the financial transaction tax (FTT) and the digital service tax (DST). Both taxes will go into effect in January 2021.
3 min read
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.
20 min read