EU: Commission starts analyzing new possible approaches of taxing the digital economy

By: Miguel Baz and Rodrigo Gastalver from DLA Piper Spain

The European Commission considers that the current taxation system was conceived in a pre-computing age so that it must be adapted in order for the digital sector to “play fair and pay fair“.

For this purpose, it has created a High Level Export Group on Taxation for the Digital Economy to analyze the best ways of taxing the digital economy in the EU, ways which will be in turn put in practice.

We anticipate that within the framework of the analysis to be produced current tax issues such as the virtual permanent establishments or the royalties upon software licenses will come up.

At the same time, the EU will continue with its cooperation with the OECD to reach to a coherent and complementary approach to digital taxation at the EU and international level.

The press note issued by the European Commission on this development is available here.