We start a discussion on an issue making headlines. COVID-19 has turned daily life into a digital
experience, as we rely more and more on virtual services for work and play.
Now, experts say, internet and platform firms will become all the more powerful and profitable
throughout the course of the pandemic,... as users around the world become loyal subscribers.
This is fueling discussion over how these digital giants should be taxed,... as many
of them are cashing in across all borders without paying their fair dues.
However, the United States has reacted in anger, with President Trump calling for an
investigation into a string of countries that are adopting digital services taxes, including
the UK, France as well as a number of EU member states.
So the question is... could we see a digital tax war?
Discussing this issue with me today is Dr. Anup Srivastava, Associate Professor and Canada
research chair at the University of Calgary in Alberta and Dr. Oh Jun-seok, Professor
of Business at Sookmyung Women's University in Seoul.
Dr. Srivastava: Will the current tax system become outdated in this new normal? (How has
the changing nature of business and digital transformations reduced
tax revenues and how
does this affect us all?) Dr. Oh: Do you think COVID-19 will accelerate
the adoption of digital taxes?
Dr. Srivastava: We're seeing different models of digital tax but
the French one has attracted the most attention. Is a 3 percent tax on all
digital firms the way to go? Dr. Oh: Will companies be willing to
comply with digital taxation? After all, they are masters of finding loopholes. How can
we make sure corporations don't find ways to evade it?
Dr. Srivastava: How should a digital tax system be designed, and
what are
the most contentious points that need to be resolved?
Dr. Oh: How should a digital tax system be designed, and what is taking the OECD so long
to find
a solution? To Srivastava: The U.S. last year hit France
with tariffs upon its decision to impose digital taxes on U.S. companies. As more and more
countries adopt their own form of
digital tax, could this lead to another global trade war?
Dr. Oh: How will South Korean companies be affected by
digital tax and how can Seoul prepare for the impact?
We'll have to wrap up the discussion here but thank you for your insights. Dr. Anup
Srivastava, at the University of Calgary in Alberta and Dr. Oh Jun-seok, at Sookmyung
Women's University in Seoul. Thank
you
for joining the programme.