Tax Challenges in the Age of Digitization of the Economy

Sandra Benedetto, Collaborator, Center for Fiscal Studies, University of Chile

As we have already pointed out, the incorporation of a digital tax is a complex issue because it must not only answer new business models that are changing dramatically – both goods and services, but also offering a solution to a problem that is still under discussion internationally.

In fact, measures such as the proposal are not exempt from discussion in the international context. Indeed, the European Community, the United States and the OECD have not reached a consensus on the measures to be taken with regard to the digital economy.

The OECD, one Through the various reports published under the BEPS initiative, he emphasized that current efforts in the field of The digital economy should focus on the implementation of this plan, relegating any specific measure in this area – for example, new special taxes – to a second stage. For this body, it is in this case that international measures could be adopted that would meet the challenges of the digital economy, all based on the consensus of the international community and increased doctrinal development.

The foregoing is explained by the fact that there is a consensus that any measure adopted will involve changing the accepted concepts of cross-border taxation, such as "permanent establishment", "source of income" or the role of withholding tax among others, which therefore require a successful discussion and which are supported by the various actors involved.

When discussing a new digital tax, it should be remembered that digital development continues to grow and grow at an unprecedented rate, any attempt at regulation poses the additional challenge of designing a sufficiently high standard sophisticated for It effectively meets the new reality imposed by digitization and technology.

However, it seems that the current discussion has focused on a specific business model, as in the case of digital platforms, ignoring the problems we face. to an ubiquitous and already installed phenomenon that does not respond to the so-called "digital economy", but rather to the "digitization of companies" in general.

For this reason, it is worth wondering if the resulting impact in business in general and in the collection in particular, phenomena such as the Internet of Things, the Industrial Revolution 4.0 " , blockchain and artificial intelligence, among others .The above – in other words, this is already happening – will affect the way of doing business, for example with customization and immediacy goods and services, the optimization of delivery times, the reduction of production costs, among others. [19659003] In this context, let's think for a moment, how blockchain technology will affect processes certification and compliance, how will artificial intelligence accurately determine the bases for taxation in cross-border transactions, and how will the foregoing re-define the role of held at source in this scenario?

We must then determine what is the appropriate tax measure to combat a phenomenon as radical as the digitization of the economy. We think this requires a look that tackles the real challenges, being sustainable over time. And when we talk about time, we can no longer refer to a future as we have always understood, but to a future that, as we speak, is already a thing of the past.