Book contents
- Taxing the Digital Economy
- Cambridge Tax Law
- Taxing the Digital Economy
- Copyright page
- Dedication
- Contents
- Figures
- Preface
- Acknowledgements
- Part I
- 1 Taxing Cross-Border Business Income
- 2 The Development of Digital Business
- 3 Challenges to the Tax System Posed by the Digitalisation of Business
- 4 Responding to the Challenges
- Part II
- Index
2 - The Development of Digital Business
from Part I
Published online by Cambridge University Press: 23 April 2021
- Taxing the Digital Economy
- Cambridge Tax Law
- Taxing the Digital Economy
- Copyright page
- Dedication
- Contents
- Figures
- Preface
- Acknowledgements
- Part I
- 1 Taxing Cross-Border Business Income
- 2 The Development of Digital Business
- 3 Challenges to the Tax System Posed by the Digitalisation of Business
- 4 Responding to the Challenges
- Part II
- Index
Summary
This chapter examines the development of digital business. It commences with a reflection on the huge benefits arising from digitalisation, including greater productivity, more competition, greater choice and convenience, innovation and profitability. It also notes that it is extremely difficult to separate the digital economy from the rest of the economy. The key features of digital businesses include direct and indirect network effects, economies of scale, anti-competitive lock-in effects, the importance of data and complementarity. The four most significant new types of business models are explained: multi-sided platforms, resellers, vertically integrated firms and input suppliers. Lastly, there are observations made about the key characteristics of highly digitalised business models which have significance and importance in the context of looking at the challenges to the international tax system.
Keywords
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- Information
- Taxing the Digital EconomyTheory, Policy and Practice, pp. 57 - 83Publisher: Cambridge University PressPrint publication year: 2021