Platforms and Big Tech Tracker
Digital Tax Initiatives benchmark expanded to include Brazil, Colombia and New Zealand
We have expanded the Digital Tax Initiatives benchmark within our Platforms and Big Tech Tracker to include policy changes in Brazil, Colombia and New Zealand. We’ve also updated the benchmark to reflect the rollback of digital services taxes (DSTs) in India and the Czech Republic. The benchmark now details adopted, pending and abandoned DST initiatives in 19 countries. While seven of the 13 countries that have adopted tax frameworks maintain a rate at or below 5%, our benchmark also includes countries that tax non-local digital services at a significantly higher rate, such as Mexico (16%), the Philippines (12%) and Indonesia (11%).
Since the deadline for the OECD’s Pillar One global tax negotiations passed in June 2024 without agreement, a number of countries, including Canada, Italy and the Philippines, have newly adopted DST regimes or amended existing tax frameworks. In Canada, the Government moved to implement its digital tax scheme – which was first introduced in 2021 – while citing the continued failure to reach an agreement on an international, multilateral tax system through the OECD negotiations. Other jurisdictions in our benchmark, including Belgium and the EU, have previously abandoned plans to implement DST frameworks based on their commitment to OECD negotiations but may reconsider these decisions in light of the lack of progress. The US, which has long opposed a global taxation system through a Pillar One settlement, is even less likely to cooperate with negotiations under the Trump Administration.
The Trump Administration’s plans to introduce reciprocal tariffs on jurisdictions that tariff or tax US firms as of 2 April 2025 has also created further uncertainty for DST frameworks. Through amendments to its Finance Bill in both 2024 and 2025, the Indian Government removed its DST regime for non-resident firms first adopted in 2016, with final changes expected to be effective from 1 April 2025, only one day before the US’ planned tariff deadline. The UK Government has similarly discussed the possibility of amending its DST regime – a 2% tax adopted in 2020 that raises approximately £800m per year – to avoid tariffs.
