Whereas the digitalisation of the economy can support the development of the country’s domestic tax base and the growth of small and medium-sized businesses by providing them with the opportunity to participate in the global marketplace, the rapid expansion of the digital economy has created challenges for the global tax regime. It has made it increasingly difficult for current national and international tax systems to tax businesses in a way that supports public finances.

Divergent effects:

Some countries will see expansion of their tax base while others might suffer from a eroding tax base.

Objective:

This paper provides evidence on the tax challenges raised by the digitalisation of the economy, with a view to gaining a full understanding of whether any supplemental measures are actually needed to address the taxation challenges of the digital economy, using country-specific case studies.