Trade and tax in the digital world
Published 12 October 2021
On October 8, the Hinrich Foundation invited a panel of four experts to discuss the importance of bridging the gap between trade and tax policies. As the world prepares for a global tax deal, it is critical for both policymakers and firms to understand why and how the digital economy is transforming traditional revenue collection systems. Watch a replay.
Neither trade nor tax are new issues. What is new are the types of challenges that digital trade poses to revenue collection. In the digital economy, firms can be located anywhere and provide goods and services online without any need for a physical presence – confounding governments facing fiscal pressures. Increasingly, trade policies need to reflect changes in tax policies and vice versa.
On 8 October, a panel of four experts discussed ways that the digital economy has affected traditional tax systems: such as by allowing firms to compete in markets without a physical presence; by the proliferation of approaches, mostly used by large firms, to manage tax more carefully; and by the participation in cross-border trade by companies previously not engaged in such transactions. As a global tax deal led by the G20 nears conclusion, closing the divide between trade and tax policy becomes more urgent.
Speakers included:
- Deborah Elms, Founder and Executive Director, Asian Trade Centre
- Peter Mullins, Tax policy adviser, former Deputy Division Chief (Tax Policy), IMF
- Juita Mohamad, Indo Pacific Fellow, Perth USAsia Center
- Stephen Olson, Senior Research Fellow, Hinrich Foundation (moderator)
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