The Legality of Digital Taxes in Europe

37 Pages Posted: 4 Jun 2020

See all articles by Ruth Mason

Ruth Mason

University of Virginia School of Law

Leopoldo Parada

University of Leeds School of Law

Date Written: June 3, 2020

Abstract

This Essay argues that EU taxpayers may challenge digital services taxes as violations of EU law. Specifically, because they exempt all but the very largest companies, which are disproportionately foreign, DSTs result in nationality discrimination as applied. As part of our analysis of the legality of digital taxes, we consider what role discriminatory intent should play in resolving nationality discrimination cases. We also evaluate potential justifications for digital taxes, and we argue that two recent decisions by the Court of Justice of the European Union suggest that the Court will uphold such taxes against challenges by taxpayers.

Keywords: digital taxes; indirect discrimination; EU law; legality; fundamental freedoms; Vodafone; Tesco

JEL Classification: K34

Suggested Citation

Mason, Ruth and Parada, Leopoldo, The Legality of Digital Taxes in Europe (June 3, 2020). Virginia Tax Review, 2020, Virginia Public Law and Legal Theory Research Paper No. 2020-50, Virginia Law and Economics Research Paper No. 2020-10, Available at SSRN: https://ssrn.com/abstract=3618663

Ruth Mason

University of Virginia School of Law ( email )

United States

Leopoldo Parada (Contact Author)

University of Leeds School of Law ( email )

Liberty Building
Belle Vue Road
Leeds, LS2 9JT
United Kingdom
+44 (0)113 343 9938 (Phone)

HOME PAGE: http://https://essl.leeds.ac.uk/law

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