Legal Analysis of Transnational Digital Service Taxation Issues in the Field of International Tax Law
Pubblicato online: 17 mar 2025
Ricevuto: 29 ott 2024
Accettato: 04 feb 2025
DOI: https://doi.org/10.2478/amns-2025-0257
Parole chiave
© 2025 Yuxiang Huang, published by Sciendo
This work is licensed under the Creative Commons Attribution 4.0 International License.
The development of digital economy has brought extensive and far-reaching impact on the world economy. The great progress of network information technology makes economic development more efficient, not only changes the industrial organization and business model of traditional industries, but also promotes the all-round digital transformation of economic structure and the rapid rise of new industries [1-2].
However, the traditional international tax rules have been unable to adapt to the current wave of the development of the digital economy, and the tax base of digital consumer market countries is being seriously eroded. As a result, the issue of digital service taxation has arisen [3-5]. The mainstream view is that digital tax refers to a country’s taxation of digital services such as search engines, social media, online advertising, etc., provided by large multinational Internet enterprises in its territory through its foreign subsidiaries [6-7].
With the continuous development of new economic forms, there are many mismatches between the traditional tax system and it, and the unilateral digital service tax measures and international concepts need to be coordinated, making the international tax environment more complex [8-10]. Since the birth of digital service tax, the study of transnational digital service tax issues has always been the core topic of international tax law.
The rules of the transactions constituted by new business models and commercial models under the digital economy have not formed a unified norm, and the rapid expansion of the scale and market share of digital enterprises in a short period of time breaks the traditional spatial constraints, generating the risk of tax base erosion and profit shifting and new challenges under the digital economy [11].
Literature [12] argues that many large multinational tech companies have escaped a large amount of taxes due to the fact that they do not use cash, a traditional means of transaction, in the course of their transactions and that it is impractical to expect the government to check, value, and tax through the data and time of each transaction, which has resulted in an unanticipated tax advantage for many tech companies. Literature [13] suggests that in order to manage taxation of the global digital economy, countries may undermine international trade relations if they attempt to tax digitized companies without taking into account the multivariate consensus, hence the urgency to study some common features of international taxation of digital services. Literature [14] found that in fact many countries preferred to adopt indirect digital services taxes rather than traditional income taxes in order to avoid violating international income tax treaty obligations when targeting certain business activities, but of course international research and consensus will continue on a broader range of digital services tax policies. Literature [15] also suggests that taxation of digital services plays a huge role in combating corruption issues and improving tax compliance, as such tax policies will influence entrepreneurs’ decisions.
Many approaches are being tried to be proposed for developing a fair and efficient tax policy for digital services. Literature [16] suggests that widening the tax base of multinational technology companies may be a viable approach, forced by fiscal and political pressures to take action, and that this approach would enable them to pay a matching share of taxes and be a fairer tax scheme. However, there are scholars who are skeptical of this approach, with literature [17] noting that even after the experience of the Wayfair case in South Dakota, states have changed the remittance rules for sales and use taxes but the effect has not been significant, i.e., tax revenue growth before and after the reforms has not been significant.
Based on the characteristics of digital service tax, this paper examines the principles of international taxation and compares the legislation of digital service tax in different countries and regions. It then elaborates on the legal nature of digital service tax, explores tax challenges and potential legal risks in the legislative process, and analyzes the legislative status in different regions. As for the legislative practice of digital service tax, this paper analyzes the implementation status in different regions such as Europe, Asia, America and Africa, and takes Amazon Group as the research object to explore the group’s sharing of French tax revenues, with a view to providing references for the construction of the international system of digital service tax.
The current international tax regime is not sufficiently effective in taxing digital giants, and digital market countries are unable to share the benefits of digital taxation. As a new unilateral option for tax allocation, the digital services tax may coexist with multilateral rules in the long term. Examining the tax system itself, confusion over the ownership of the tax has led to doubts about its legitimacy, and suspicions of discrimination in the tax threshold have led to disputes over its fairness. Therefore, considering the international tax law regulation of the digital service tax at different levels will help China better modernize and transform its tax system, strengthen the equity theory in the central tax division, and provide a reference for tax legitimization in the digital era [18].
Digital Service Tax (DST) refers to the taxation of income from digital services such as social media platforms, search engines, online intermediary platforms, and online advertising provided by digital enterprises. As the digital economy is characterized by asset-light and cross-regional transactions that make it more difficult to determine the permanent establishment of the tax subject, thus making the problem of international tax evasion increasingly serious, it is difficult for the traditional tax system to meet the practical needs of taxing the digital economy. This not only brings difficulties to the division of tax jurisdiction for the digital economy, but also aggravates the erosion of the international tax base and the unfairness of industry taxation. And economies such as the European Union, the United Kingdom and India, salivating at the huge tax revenues brought by the digital service tax and trying to compete for the right to speak in the digital economy governance system, have begun to unilaterally levy the digital service tax. The scope of digital services tax is shown in Figure 1, and it has shown different scopes of practice in different countries.
The range of digital service taxes
Taxation is one of the important tools for the state to carry out macro-control, and the newly introduced digital service tax will definitely bring a series of impacts to the economy. Although China has not introduced digital service tax, as a member of the world economy, the introduction of digital service tax in some countries will certainly have an impact on China’s tax. As a tax system, digital service tax will have impacts from three aspects: economic, political, and social.
Digital service tax mainly affects consumption, investment and import and export through the effect of fiscal revenue, the effect of long-term equilibrium of supply and demand, the effect of social welfare and the effect of tax burden distribution.
According to the definition of MSA think tank, politics usually refers to the behavior of the government and political parties in governing the country, including not only the behavior of governing the country internally (supervision and control of domestic affairs), but also the behavior of governing the country externally (supervision and control of international affairs). The political impact of digital service tax, i.e.How the digital service tax affects government and political parties’ behavior in governing the country.
The MBA Think Tank defines social impact as the interactions between individuals in social life, which encompasses all forms of individuals, including individuals, businesses, and governments.The social impact of digital service tax is a result of the government introducing unilateral digital service tax on individuals and enterprises’ behavior.
Digital service tax is an indirect tax on the gross operating income of digital businesses provided by digital enterprises, and it is a unilateral tax measure resorted to by some countries to reduce the erosion of the tax base and profit shifting by international tax pits to their own countries.
From the current situation, most of the countries that levy digital service tax are European Union countries, and the tax rate of digital service tax is relatively low and the tax targets are mainly multinational digital enterprises that have reached a high income scale. However, at the practical level, digital service tax has been questioned in terms of legitimacy, fairness and feasibility, and low-tax countries within the European Union are not in favor of a unilateral digital service tax, while the United States even considers digital service tax as a kind of tax discrimination. The divergence of the digital service tax mainly lies in the fact that the EU demands to obtain the tax sovereignty of the digital economy and to protect the tax interests of the downstream of the digital economy value chain, while the United States is motivated by the need to safeguard the competitive advantages of its own digital enterprises and to attract the return of digital enterprises to its own country [19]. The final result of the game of rules between the two sides is recognition of each other’s interests in the latest two-pillar scheme. The “two pillars” of BEPS of international tax rules are shown in Figure 2. “Pillar 1” adopts the principle of “safe harbor”, which sets the upper limit of profit redistribution for the market participating countries, and the market countries are entitled to distribute the remaining profits. Pillar I adopts the “safe harbor” principle, setting a ceiling on profit redistribution for market participants, and giving market countries the right to distribute surplus profits. Pillar II recognizes international tax competition and realizes the repatriation of profits from multinational digital enterprises to resident countries through the lowest global corporate tax rate of 15 per cent and the domestic top-up tax rule, which is matched by the lowest global tax rate on intangible assets.
BEPS “double pillar” of international tax rules
The main purpose of the digital services tax in each country is to address a series of tax challenges brought about by the digitalization of the economy, and some countries may also hope to reduce the impact of large multinational digital enterprises on their own digital markets through the introduction of the digital services tax.
The digital services tax policies of France, the UK, and Austria are similar in that they all adopt proportional tax rates and are accompanied by revenue thresholds. However, they have their own considerations on other tax system design, and the relevant tax system elements, as shown in Table 1, mainly include the limitation of the levy scope and income threshold, which, to a certain extent, can better ensure that all kinds of enterprises subject to the digital service tax realize tax fairness.
Relevant tax system elements
| Country | Progress of the bill | Tax scope | Income threshold |
|---|---|---|---|
| France | Promulgate (extension until the end of 2020) | The ratio of the “French digital presence” to the corresponding global digital service income is associated with the French tax service income section: Provide a digital interface that enables users to connect with others and interact. The advertising agent based on the number of users. |
Global revenues of more than 750 million euros are worth more than 25 million euros in taxable income related to French user activity. |
| England | Promulgate (April 1, 2020) | From the UK, which belongs to the income of three kinds of words: Social media platform. Search engine. Online market. |
Global revenues are more than 500 million pounds, and it comes from Britain’s revenue of more than 25 million pounds. |
| Austria | Promulgate (January 1, 2020) | Digital service providers provide Austria with the revenue of advertising services. | The turnover of taxpayers’ groups has exceeded the turnover of 750 million euros and digital advertising services more than 25 million euros. |
The coordination between the digital service tax and the domestic tax system mainly exists in two aspects, one is to solve the problem of base erosion and profit shifting brought about by the digitization of the economy under the current domestic tax system. The second goal is to prevent the issue of double taxation that may arise in conjunction with the current tax system.
The digital service tax was initially created to solve tax problems caused by the digitalization of the economy. Whether it is the United Kingdom, which takes a specific digital business as the scope of taxation, or France, which confirms the scope of taxation according to the nature of digital services, the introduction of the digital service tax establishes a new tax jurisdiction by recognizing the user’s participation and the value-creation process of the user’s data.
In order to address the enormous challenges posed by the digital economy to global tax governance, the international community has developed a variety of options for globalized tax governance, including unilateral tax measures, bilateral tax agreements and multilateral consensus. Through different stages of germination, inception, controversy, and development, digital services tax is transforming from an interim solution to a new international legislative trend.Countries have engaged in extensive legislative practice on digital services taxes through unilateral, bilateral, and multilateral mechanisms.
The digital services tax arises in a complex context. The development of the digital economy necessitates the modification of the traditional international tax system, but the negotiation and consultation process is expected to be challenging. In fact, it is currently completely impossible to reach agreement between the United States and Europe. It is precisely for this reason that the EU is considering proposing to introduce a digital service tax within the EU on the sales revenues of US Internet giants providing digital services in the EU first, in the event that the US is unwilling to solve the problem under the OECD digital service tax framework. Under the provisions of the current EU Digital Services Tax Act, the core feature of the Digital Services Tax is the creation of value by users. Therefore, the EU specifically states that the digital services tax will only tax revenues generated from certain digital services characterized by user participation in value creation, and not the profits of businesses. Regarding the legal nature of digital service tax, its specific research dimensions are shown in Figure 3, which mainly includes two aspects, on the one hand, analyzing from the aspect of whether digital service tax is a direct tax or an indirect tax, and on the other hand, analyzing the contents of taxation under different industries.
The law of digital service tax
Up to now, all industries in China have changed from business tax to VAT, and it is not appropriate to levy business tax on digital enterprises, and at the same time, China has already had enterprise income tax on enterprise profits, so it is not appropriate to levy digital service tax of income tax nature on digital enterprises. To summarize, China’s digital service tax can only be a value-added tax.Therefore, this paper considers that the digital service tax is more akin to the legal nature of indirect tax and value-added tax from the perspective of domestic tax.
The traditional international tax system consists of both international and domestic components, with the international component mainly embodied in model international tax agreements, such as the OECD Model Agreement and the UN Model Agreement. The domestic law component of the international tax system is represented by the income tax laws of various countries and their cross-border income tax regulations.As an emerging tax, the digital service tax has emerged as a more systematic tax after continuous development and reform. Although no unified international tax agreement has been reached so far, it has been established in the domestic law, such as France, the United Kingdom, India and other countries have introduced the digital tax bill, and digital service tax has also been introduced in practice. Therefore, the arrival of digital service tax will change the existing international tax system. The challenges to international tax rules posed by digital service tax legislation are shown in Figure 4, which mainly include the dimensions of difficulty in applying the traditional theory of tax jurisdiction at source, increasing the degree of unilateral threat, and increasing the difficulty of tax collection and administration.
Tax challenges for digital service taxes
Compared to the traditional tax system, the taxation of digital economy objects is more complicated. At present, China does not have a systematic tax regulation for digital services. However, as the development of the digital economy continues to deepen, provisions on the digital economy can be found sporadically in the existing tax policies and regulations to strengthen guidance and standardization. They mainly include laws, local regulations, and rules and regulations of relevant departments.
The statistical results of the current status of international legislation on digital service tax are shown in Table 2. According to the latest report on the development of global digital economy tax laws and regulations, 146 countries in the world have enacted laws and regulations on digital economy tax, and 57 countries have proposed to levy or introduce direct digital service tax. The tax system mainly includes direct and indirect taxes, and its main purpose is to facilitate the physical landing of cross-border digital enterprises and promote fairer tax collection.
The legislative status of digital service tax
| Tax class | Direct tax | Indirect tax | Total |
|---|---|---|---|
| legislated | 42 | 104 | 146 |
| Refuse to make public announcements/proposals | 14 | / | 14 |
| Draft legislation/public consultation | 8 | 15 | 23 |
| Wait for global solutions | 11 | 4 | 15 |
| Declare/intend to implement | 9(Including China) | 3 | 12 |
Years of theoretical and practical experience have taught us that it is impossible to claim that State legislation is always rational. There are plenty of examples of irrationality in national law-making, and legal economics has analyzed examples to show that even if the legislative process is democratic and the motivation is good, this does not mean that the law-making is rational. At this stage, the legal framework for digital service tax appears to prevent base erosion and increase government revenue in the short term.However, it will take a number of years to fully assess the legitimacy of the legal system. In practice, the implementation of a legal regime often creates new problems while solving some. Therefore, the irrationality of the legal system is slowly becoming apparent, and the potential risks of this new and highly targeted tax will naturally arise. The potential risks of the digital service tax are shown in figure 5, specifically, these risks are reflected in the risk of tax burden shifting, the risk of legal double taxation, the intensification of trade barriers, the intensification of the game of tax interests, and the disorder of the international tax order.
Legal risk of digital service tax
The ultimate bearer of the tax burden is not the taxpayer as specified in the law. In general, the tax burden is determined by the price elasticity of production factors, which is influenced by consumer preferences, competition, and other factors. As a result, the tax burden is highly susceptible to shifting, and such shifting may occur for both income tax and VAT, as well as for digital service tax.
The legal regime of digital service tax is highly susceptible to disturbance of international tax rules, leading to double taxation problems.
The increasing wave of unilateral tax measures and the U.S. resistance to the digital service tax will aggravate the conflict of tax interests and fuel the flames of “tax war” around taxable income.
At a time when no international consensus has been reached on the theoretical problems of tax rules for economic digitization, unilateral taxation can solve the problems for a while, but there is a risk of disrupting the international tax order.
Along with the rapid development of modern digital information technology, the digital economy has become increasingly prosperous, bringing great wealth growth to all mankind. However, the impact of economic digitization on the theory and practice of international taxation has made the existing international tax system face serious challenges. With the help of digital technologies such as big data, cloud computing and artificial intelligence, multinational digital enterprises can provide digital services to local users without setting up entities in the source countries and obtain high profits. However, as the existing international tax system is based on the traditional international tax theory system, it is unable to flexibly carry out effective tax collection and management of the digital economy, resulting in the tax burden level of the digital economy being much lower than that of the traditional economy, which is unfair. Therefore, in order to cope with the digitalization of the economy, the international tax system should be reformed.
European countries are the mainstay of digital service tax implementation, and Asia is developing transitional solutions based on digital service tax in these countries.The introduction of digital service tax in European and Asian countries is shown in Table 3.
National digital service tax registration
| Region | Country | Opening time | Collection range | Tax rate | ||
|---|---|---|---|---|---|---|
| Digital service range | Global turnover | Domestic turnover | ||||
| Europe | France | 2019.01 | Digital business advertising and cross-border data flow and other digital transactions | 750 million euros | 25 million euros | 3% |
| Italy | 2020.01 | Directional advertising and digital interface service | 750 million euros | 5.5 million euros | 3% | |
| Austria | 2020.01 | Online advertising | 750 million euros | 25 million euros | 5% | |
| Turkey | 2020.03 | Targeted advertising, social media and digital interface services | 750 million euros | 20 million Turkish lira | 7.5% | |
| England | 2020.04 | Social media, search engines and online marketing services | 500 million sterling | 25 million pounds euro | 2% | |
| Spain | 2020.12 | Online advertising, online intermediary services, sales users, etc. | 750 million euros | 3 million euros | 3% | |
| Czech | 2021.06 | Digital service | 750 million euros | 100 million kronor | 5% | |
| Aisa | India | 2020.04 | E-commerce transactions | 20 million rupees | 20 million rupees | 2% |
| Singapore | 2020.01 | Digital services related transactions | Million new yuan | 100,000 new yuan | 7% | |
| Malaysia | 2020.01 | Including audio and streaming media services | 120,000 dollars | 120,000 dollars | 6% | |
| Thailand | 2021.09 | Electronic service transaction | 1.8 million baht | 1.8 million baht | 7% | |
Based on the practice of digital service tax in Europe and Asia, it mainly consists of the following aspects of similarities and differences:
1) Tax rate, the countries that have introduced digital service tax generally adopt proportional tax rate, but the tax rate varies greatly. At present, the digital service tax rate in Europe and Asia is basically between 2% and 7.5%, with a small span, such as the tax rate of 2% in the United Kingdom and India, and 7.5% in Turkey, while the tax rates of 2% and 3% are most commonly used. The Spanish Cabinet approved the adoption in early 2020 of the decision to introduce a digital services tax of 3% on online advertising and transactions of companies with global revenues of more than 750 million euros. 2) With respect to taxpayers, the tax is primarily aimed at non-resident large digital businesses, but there are differences in the definitions regarding the size of the business. The tax thresholds set by European countries are generally high and are based on a linkage rule approach, whereby taxpayers need to meet both worldwide turnover and national turnover criteria. Taxing large digital businesses can curb their long-term tax avoidance behavior and also provide a competitive advantage for smaller digital businesses in the country. India’s digital services tax is levied at a low threshold and applies to companies with an annual revenue of more than Rs. 20 million, which basically covers all foreign retailers operating in the Indian market that offer online goods and services. Singapore levies the tax in early 2020 on cross-border digital businesses with an annual turnover of more than S$1 million and local sales of more than S$100,000. 3) As regards the taxable objects, they are generally income related to the digital economy, but the specific scope varies slightly, including income derived from advertising and online marketing of digital businesses. The main categories are as follows, i.e. income derived from the provision of search engines, income derived from the provision of online advertising, income derived from the provision of social media platforms, income derived from the provision of intermediary services for digital interfaces, income derived from the provision of digital interfaces for obtaining information on users, etc.
The development of digital services tax in the major countries of the Americas region has been slow, with North American countries showing little incentive to introduce a digital services tax and Latin American countries proposing numerous bills on digital services tax, but most of them remain at the stage of being considered for adoption. In addition, in order to make up for the loopholes in certain aspects of the international tax system and to protect their own sources of tax revenue, legislation on digital service tax laws in the African region is also quietly underway. The introduction of digital services tax in the Americas and Africa regions is shown in Table 4.
The registration of the digital service tax
| Region | Country | Opening time | Collection range | Tax rate |
|---|---|---|---|---|
| America | Canada | 2021.07 | Global income is more than $759 million and domestic income of more than $30 million. | 3% |
| Brazil | 2020.01 | Global income is more than $600 million, and revenue in Brazil is divided into three levels, with a different level of 3% and 5% tax. | 1%,3%,5% | |
| Mexico | 2020.05 | Global income is more than $5 billion and domestic income is more than $30 million | 16% | |
| Chile | 2020.06 | Global income is more than $5 billion and domestic income is more than $30 million | 19% | |
| Paraguay | 2021.01 | Global income is more than $5 billion and domestic income is more than $30 million | 10% | |
| Costa Rica | 2020.10 | Global income is more than $5 billion and domestic income is more than $30 million | 13% | |
| Africa | Kenya | 2021.01 | Annual income of more than $5 million | 1.5% |
| Tunis | 2020.01 | Annual income of more than $0.5 million | 3% | |
| Zimbabwe | 2019.01 | Annual assessment of more than $500,000 | 5% |
Based on the practice of the countries in the Americas region, it can be clearly seen that the overall tax rate of the digital service tax implemented in the Americas region shows a large variation, and its tax rate ranges from 1% to 19%. Among them, the digital service tax rate set by Chile reaches 19%, while Brazil adopts a three-tier tax rate planning, the digital service tax rate of the relevant enterprises with an annual income of less than 0.2 billion U.S. dollars is only 1%, but there is no major difference in the digital service tax rate of enterprises with more than 0.6 billion U.S. dollars. Especially with the onslaught of the new crown epidemic in 2020, the inclusion of the digital services tax in the existing tax in the Americas region will help to enhance the possibility of acceptance by the masses. In addition, the digital services tax in the African region was undertaken with the aim of securing a source of tax revenue for the region, and it is proposed that a digital services tax of between 1% and 3% be levied on the total revenue from digital services received by any national company or multinational enterprise each year. The practice of the countries that have introduced it shows that their average digital services tax rates are low, even at 5 per cent in Zimbabwe, which is much lower than in most countries in the Americas region, reflecting the fact that countries in the Africa region have mainly taken a robust approach to advancing digital services tax legislation.
Amazon’s customers in the online business model include consumers and external suppliers.Amazon, an online operating store, is also an offline retailer, fully connecting online and offline differentiated lines of business to achieve more effective economies of scale. To address the collection of digital service tax by multinational companies, this paper selects Amazon Group for a case study on digital service tax.
Analyzing the change in revenue of Amazon Group helps to understand the relevant digital service tax paid by Amazon Group during cross-border trade.Based on the relevant financial report data of Amazon Group in previous years, this paper organizes to obtain the composition of Amazon Group’s revenue during the period from 2015 to 2022, as shown in Figure 6.
The revenue composition of amazon group in 2012-2022
In the business model of the online store, consumers (users), external sellers, and Amazon are all creating value together, and the value creation is realized in all aspects. Amazon Group’s revenues come from online store services, which account for about 23% to 33% of revenues during 2015-2022. And Amazon platform company through the process of value realization in all aspects of the online shopping model, through the sale of services to obtain business income, this process can also be called value consciousness. Amazon not only has the advantage of data resources, but also has the advantage of infrastructure resources to achieve efficient operation of its online store business model. So far, Amazon outperforms its competitors and has a huge competitive advantage in the market, which in turn makes it more attractive to potential customers and external vendors.From 2015-2022, Amazon’s external service revenue from third-party vendors grows annually from $1,194,800,000 in 2015 to $5,863,700,000 in 2022, and in 2022 it accounts for 12.56% of total global business revenue in the year. It is important to note that the revenue generated by the Amazon platform and its type is critical to Amazon as a whole.
To address the taxation of Amazon Group’s multinational business income both at home and abroad, this paper focuses on the data analysis of Amazon Group’s taxation in France.Based on the analysis in section 4.1.1, it can be understood that France mainly imposes a digital service tax on companies with global digital business revenues of more than 700 million euros.In order to achieve tax equity in the country, France will impose a digital service tax on more than thirty internet giants.Figure 7 shows the change in central government tax revenues as a share of GDP in France from 2015 to 2022.
France’s tax revenues account for a change in the proportion of GDP
As can be seen from the data in the graph, the share of tax revenues in the French central government increases as the years go by, and in 2020, after the legislation of the digital services tax, even with the impact of the New Crown epidemic, France’s share of tax revenues in 2020 is 24.62%, and after the start of the digital services tax, the Amazon Group’s share of tax revenues at the 3% tax rate contributed tax revenues amounting to $0.5 million, reaching 13.65% of French tax revenues. In 2022, France’s overall tax revenue as a percentage of GDP will reach 25.58%, at which point the Amazon Group will contribute close to 15% of the digital services tax. On the whole, after the legislation of digital service tax in France, its overall tax revenue has greatly improved, with the digital service tax revenue of Amazon Group increasing year by year. It can be seen that the legislation on digital service tax can help source countries to enhance their tax capacity to a certain extent, and provide support for their own “tax fairness”.
After the introduction of the digital service tax reform in France, there has been a global boom in digital service tax legislation. It can be said that the legislation on digital service tax is in line with the development trend of digital business models that are sagging due to the digitalization of the economy. In the process of designing digital tax rules, it must be realized that blindly imitating and applying the design of other countries’ digital service tax legislation is not desirable. China should utilize the value choices of other countries’ digital service tax legislation to design a digital service tax system that is compatible with its own system and characteristics. Specifically, it should start from the following points:
In the value selection of digital service tax legislation, the development of the national digital economy industry and the creation of a favorable digital business environment should be put first.Digital economy is a new industry developed through the collision of traditional economy and science and technology.Under the environment of economic downturn, the digital economy plays an important role in reducing risks and promoting consumption.
On the one hand, in the international game of tax system change, the levy of digital service tax reflects the national attitude and is a part of the battle for international discourse. On the other hand, the research and formulation of digital service tax rules is an opportunity to prepare for the future tax system change as a tax reform exercise. Reasonably set the object and scope of collection for digital service tax and leverage the positive role of taxation in policy orientation.
The change of digital tax rules should first be compatible with China’s existing tax system, and China needs to pay attention to the relevant provisions of the WTO on service and product trade. Especially in national treatment and most-favored-nation treatment, it needs to comply with the relevant regulations to avoid being criticized by other countries.
This paper takes the characteristics of digital service tax and international tax principles as the starting point, analyzes the legal positioning of digital service tax, and conducts quantitative analysis for the implementation status of digital service tax.
1) The digital service tax rate in Europe and Asia is basically maintained between 2% and 7.5%, with a smaller overall span, mainly dominated by the 2% and 3% tax rates, and with greater dissimilarities in the taxing objects and taxpayers. Therefore, the overall change in digital service tax in the Eurasian region is relatively small, and its main purpose is to better maintain the tax fairness of the country. The level of digital services in the Americas and Africa ranges between [1%, 19%], with a larger overall span, which also, side by side, reflects the differences in the level of the digital economy in different regions, which leads to some countries adopting a higher digital services tax to enhance their own tax revenues.
2) Through the cross-border trade tax payment of Amazon Group, relying on the income received from cross-border e-commerce business will increase the proportion of France’s tax revenue year by year, and after the implementation of the digital service tax system, the contribution rate of Amazon Group to France’s tax revenue in 2022 reaches 14.89%. Setting a 3% digital service tax rate can help some countries realize tax revenue to a large extent, which shows that a reasonable digital service tax rate can help enhance the country’s tax revenue and also better promote the quality of cross-border trade.