Taxation of the digital economy

The OECD expects to unveil a solution in October 2020 on new digital taxation rules, showing that jurisdictions are close to an agreement ‘despite recent hiccups’, according to Pascal Saint-Amans, OECD deputy director for tax administration.

As reported last week, the US recently pushed for a pause in pillar one discussions while countries deal with the fallout from the coronavirus pandemic, and many administrations are moving ahead with their own unilateral digital services taxes, defying US opposition. Saint-Amans does not, however, rule out finalising a deal by the end of 2020, and expects that there may be more room for manoeuvre following the US presidential election in November, with the winning party more easily able to commit to a position at that point.