Evaluating the Tax Implications of Digital Business Models and Challenges they Pose for Tax Authorities

• Post by: airjournals
• September 12, 2023
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Ojeh, Nwode Offor

Federal College of Education Technical Isu, Ebonyi State

AbstractThe rapid ascent of the digital economy, encompassing platforms like e-commerce, online marketplaces, and Software as a Service (SaaS), has introduced novel challenges to global tax regimes. Predominantly, traditional tax systems, built around tangible assets and physical presence, are confronting difficulties in addressing the unique revenue structures of digital businesses. This study aimed to scrutinize the diverse tax implications stemming from various digital revenue models and to evaluate the capabilities of tax authorities in developing countries in handling the intricacies of the digital economy. To achieve this, both regression analyses and Chi-Square tests were employed. Data were gathered through a questionnaire, of which 150 were distributed, and 119 were duly returned. Our findings indicate significant variations in tax implications across different digital revenue models. Contrary to prevailing assumptions, tax authorities in developing nations demonstrated notable competency in identifying taxable entities within the digital landscape. The study offers insights for policymakers and businesses alike, emphasizing the need for more adaptive and responsive tax strategies in the age of digital transformation. Keywords Tax Implications; Digital Business Models; Tax Authorities Citation Ojeh, N. O. (2023).  Evaluating the Tax Implications of Digital Business Models and Challenges they Pose for Tax Authorities. International Journal of Economics and Public Policy, 7(2), 16-25 https://doi.org/10.5281/zenodo.8338036