The IMF proposed to unify taxation of the digital industry

Starting next year, countries that are members of the World Trade Organization (WTO; includes 164 states) may gain the right to impose customs duties and other fees on so-called electronic transfers (digital goods, services), IMF experts warn in the report “Mobilizing Budget Revenues and digital trade: taxation at the border or beyond? The corresponding 1998 WTO moratorium will expire by February 2024.

Although the agreement covers any information, the essence of the problem is the distribution of taxes on sales of software, services, computer games, music and films, as well as access to their collections. And so we are talking about taxing the operations of the world’s largest technology companies, such as Alphabet, Microsoft, Apple or Netflix. They sell services through their own services or even devices to users around the world, often ignoring tax levies from third countries. However, profits from these worldwide sales are taxed by the parent corporation, such as the United States, or in special jurisdictions, such as Ireland. The budgets of the countries where service users live often receive nothing, and local companies, forced to pay all taxes, lose competition to American technology corporations. The Organization for Economic Co-operation and Development (OECD) estimated the annual loss of countries’ budgets due to such business practices of Internet giants at $100–240 billion.