Blueprints for a New PE Nexus to Tax Business Income in the Era of the Digital Economy
63 Pages Posted: 29 Mar 2015
Date Written: January 1, 2015
This paper outlines the core issues of the introduction of a new PE nexus based on digital presence. It puts forward its essential features and rethinks the foundations of the concept of sourcing for income tax purposes in the global economy. Our proposal of a new PE nexus based on digital presence is also supported by a theoretical reconstruction in the light of a new dimension for the benefit theory.
Our work directly relates to Action 1 of the OECD/G20 BEPS Project. However, the development of a new PE nexus is in fact not an instrument to counter BEPS, but reflects a structural revision of the criteria for allocating taxing rights on cross-border business income in the era of the digital economy.
Keywords: Tax, Digital Economy, International Taxation, BEPS, International Tax Regime, Tax Reform, Permanent Establishment, Nexus, Benefit Theory
JEL Classification: K34, K33
Suggested Citation: Suggested Citation