Tax Challenges Facing Digital Enterprises

Introduction

The global economy is in the midst of a digital transformation, and tax authorities are struggling to keep up. Thee rise of digital enterprises has created new challenges for tax authorities around the world. Major corporations are increasingly conducting their business online, and many are using sophisticated tax avoidance strategies. In response, governments are beefing up their tax enforcement efforts. But they face an uphill battle because the tax rules are complex and outdated, and the global tax system is fragmented. The tax challenges facing digitized enterprises are significant, and it is clear that the taxation system was not designed with digitized enterprises in mind, and as a result, these businesses face unique tax challenges. These challenges posed by digital enterprises are likely to intensify in the years ahead, as more businesses move online, and the use of artificial intelligence and other digital technologies grows. The emergence of digital enterprises has defied the international principles of taxation and it is challenging to juggle the traits of these new digital business models with the tenets of the established global tax system.