Tax Administration

Roadmap to the digital tax debate for developing countries

This article reviews the policy advancements on digital taxation, the individual initiatives that some developed countries have enacted, and considers some recommendations for developing countries to address future changes. It also contains a brief analysis of the Ecuadorian VAT reform for digital services and other possible options that need to be considered by the country.

Brazilian Tax Incentives to Startups

December 3, 2020

As entrepreneurial ventures, startups generally focus on capitalizing upon a perceived market demand by developing a viable product, service, or platform. According to the Brazilian Startup Association, there are approximately 13,000 startups in Brazil, and the number has been increasing year after year.

Exchange of Information and the Rule of Law: Confidentiality and safeguards for the automatic processing of data in a world of big data

Developed and developing countries have committed to implement global standards as developed by the OECD with the political mandate of the G20 including standards that provide for exchange of information among tax administrations. Some of  the reasons for this exchange to take place, is the need to provide tax administrations with the relevant information on taxpayer’s activities/assets abroad, as well as to ensure that taxpayers including multinationals pay their fair share of taxation. Exchange of information is the key instrument for tax administrations in order to prevent tax evasion, tax fraud, and aggressive tax planning.

Tax Evasion in Latin America and the Caribbean: An Urgent Call for Attention in the Most Unequal Region in the World

The primary objective of this post is to highlight the importance and gravity of the existing tax evasion in Latin America and the Caribbean today. A study conducted by Santiago Diaz de Sarralde Miguez reports that Latin America and the Caribbean are characterized by a relatively low tax burden, which averages 22.8% of GDP. That is 11.5% less than the OECD (2015). While it is true that there are large differences between countries, as the tax burden varies from 12.4% in Guatemala to 38.6% in Cuba.

Azerbaijani practice of taxing cross-border digital supplies: Needs for Improvement

Technological progress and trade liberalization dramatically increased electronic trade and opened new chapter for the businesses to remotely supply services and intangibles to the customers anywhere around the world. Such rise of e-trade and emergence of global economy created new challenges for the policy makers in applying goods and services tax (GST) on cross-border business to consumer (“B2C”) transactions.

A commentary on the proposed digital services tax in Kenya: a case of premature legislation?

While the desire to tax digital platforms is legitimate, the strategy taken by the country may be too costly. It is likely that this law may face future amendments to include factors such as thresholds so that the tax administration aspect is cost effective. For example, the law provides that this amount shall be due at the time the amount is paid to the service provider for the service, it is unclear how this is supposed to be remitted. If you compare this to rental income tax which is due by the 20th of each month, one is able to consolidate the income and make the necessary payments without incurring any unnecessary transaction charges from the intermediary financial institutions.

Taxation of Digital Economy in Peru

In the modern world, new questions arise since due to the new technologies, the criteria described before may not be enough to determine if certain operations should be taxed or not in certain jurisdictions. In the following lines we will presenting the situation of digital economy taxation in Peru and where possible, offer solutions where necessary.

Taxation of Digital Services in Argentina

The taxpayer is the user or consumer of the digital service. However, if an Argentine resident intermediary mediates in the payment, it must act as withholding agent. If more than one intermediary are involved, the one with the closest business relationship with the digital service provider must act as the withholding agent. If no Argentine payment intermediary is involved, then the recipient of the services must report and pay the VAT through an electronic bank transfer to the Argentine Tax Administration.

Call for Blog Posts: Taxation and the Digital Economy - Latin American and the Caribbean Regional Perspectives

This symposium organized by the AfronomicsLaw with the assistance of Monica Victor focuses on the synergies between taxation and the digital economy in Latin America and the Caribbean.

Taxation and the Social Contract in a Post-Pandemic Era: Domestic and International Dimensions

How States proceed with building consensus to create a social contract that facilitates effective taxation, especially in the light of the massive disruptions caused by the pandemic will require continuous engagement by all parties. Success will perhaps depend on how proactively and quickly countries and the international taxation system unlearn old habits and begin to ascribe to the new normal way of doing things.