DIGITALEUROPE's position on Fair Taxation of the Digital Economy - Executive Summary

Key Principles

1.1. We embrace this quote from the G7 communiqué on 11 June 2018: “We are committed to work together to seek a consensus-based solution by 2020. We will exchange approaches and support international efforts to deliver fair, progressive, effective and efficient tax systems. We welcome the OECD interim report analysing the impact of digitalization of the economy on the international tax system.”

Indeed, DIGITALEUROPE fully supports OECD-led efforts on renewing tax systems to make them fit for the digital age. We are happy to foster European leadership in designing solutions that fit the global scale of the markets in the digital era.

• To review the appropriateness of the current international tax framework;
• Whether value creation from data should be recognized in allocation of taxing rights and receipts;
• To achieve global consensus and alignment of rules.

Ultimately, this should be a discussion about allocation of tax receipts rather than a greater overall tax burden on business.

The OECD is moving forward, the BEPS final report stands chances to be available in 2019 instead of 2020 as originally scheduled. Unilateral measures are therefore unwarranted.

1.2. The digital economy should not and cannot be ring-fenced. A separate set of rules will not promote the claimed goals of fairer, more effective and efficient taxation, tax certainty and better functioning of the (Digital) Single Market or even prevent tax avoidance.

1.3. To safeguard the principles of fairness and integrity in tax policy, any tax on the activities of corporations should be linked to profit, not revenues, and should not result in double taxation and not undermine the existing tax treaties.