Although we live in an age in which everything and everyone is ‘online connected’, countries’ profit taxation systems are still based on an economic reality of around a century ago. And that creates tension. The problems this tension causes are particularly evident in the case of profits generated by internet-related activities. The fact that these ‘online profits’ are difficult to tax is becoming increasingly critical, given the rising share of the economy now accounted for by digital activities. Although the time may not yet be ripe for fundamental reform, we perhaps ought in any event to start thinking about the direction in which our corporation tax systems should be moving. Suggestions in international tax literature, as well as from the OECD and EU, point in the direction of attributing the taxable base to the market jurisdiction; in other words, of imposing corporation tax on, or also on, the basis of the destination principle. There is certainly something to be said for these suggestions. The world is changing. And perhaps it is now time for our tax systems to change along with it.
Fiscal Autonomy and its Boundaries
Intertax: international tax review
Erasmus School of Law

de Wilde, M. (2015). Tax jurisdiction in a digitalizing economy; why ‘online profits’ are so hard to pin down. Intertax: international tax review, 43 (2015)(12), 796–803. Retrieved from