Direct Digital Services Taxes in Africa and the Canons of Taxation
The unprecedented expansion of the digital economy has increased the intricacy of mobilising tax revenues from both domestic and international transactions. Tax evasion and avoidance are perpetuated by the invisible nature of digital transactions. To minimise the untapped revenues, countries all ove...
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| Format: | Article |
| Language: | English |
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MDPI AG
2022-07-01
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| Series: | Laws |
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| Online Access: | https://www.mdpi.com/2075-471X/11/4/57 |
| _version_ | 1797409335885692928 |
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| author | Favourate Y. Mpofu Tankiso Moloi |
| author_facet | Favourate Y. Mpofu Tankiso Moloi |
| author_sort | Favourate Y. Mpofu |
| collection | DOAJ |
| description | The unprecedented expansion of the digital economy has increased the intricacy of mobilising tax revenues from both domestic and international transactions. Tax evasion and avoidance are perpetuated by the invisible nature of digital transactions. To minimise the untapped revenues, countries all over the world are mapping policy strategies on how to collect revenue from this sector. African countries are not an exception. They have constructed digital tax policies to levy both direct and indirect taxes on digital transactions. This paper focuses on direct digital service taxes (DSTs). Direct digital service taxes have been an issue of debate among governments, policy makers, academics, tax bodies, and development organisations. Disagreements coalesce around their structure, their adherence to the canons of taxation, opportunities, and challenges as well as consequences of implementing them. Through a literature review, this paper assesses the legislative structure and administration of digital service taxes in relation to the canons of taxation. The findings of the review were conflicting. While certain aspects, motives, and possible outcomes of the taxes upheld the principles of taxation, some of these were conflicting with the principles. This could possibly be linked to variations in the economic, political, and social contexts in African countries and between developed and developing countries. The study recommends that while digital service taxes are an irrefutable necessity to tap tax revenues from the digital economy, African countries should ensure that equity, neutrality, economy, and efficiency among other principles are considered and balanced with the fundamental roles of tax policy. |
| first_indexed | 2024-03-09T04:12:52Z |
| format | Article |
| id | doaj.art-714b65c7965d4cf5b86b2bf0f696706d |
| institution | Directory Open Access Journal |
| issn | 2075-471X |
| language | English |
| last_indexed | 2024-03-09T04:12:52Z |
| publishDate | 2022-07-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Laws |
| spelling | doaj.art-714b65c7965d4cf5b86b2bf0f696706d2023-12-03T13:58:17ZengMDPI AGLaws2075-471X2022-07-011145710.3390/laws11040057Direct Digital Services Taxes in Africa and the Canons of TaxationFavourate Y. Mpofu0Tankiso Moloi1School of Accounting, University of Johannesburg, Auckland Park, P.O. Box 524, Johannesburg 2006, South AfricaSchool of Accounting, University of Johannesburg, Auckland Park, P.O. Box 524, Johannesburg 2006, South AfricaThe unprecedented expansion of the digital economy has increased the intricacy of mobilising tax revenues from both domestic and international transactions. Tax evasion and avoidance are perpetuated by the invisible nature of digital transactions. To minimise the untapped revenues, countries all over the world are mapping policy strategies on how to collect revenue from this sector. African countries are not an exception. They have constructed digital tax policies to levy both direct and indirect taxes on digital transactions. This paper focuses on direct digital service taxes (DSTs). Direct digital service taxes have been an issue of debate among governments, policy makers, academics, tax bodies, and development organisations. Disagreements coalesce around their structure, their adherence to the canons of taxation, opportunities, and challenges as well as consequences of implementing them. Through a literature review, this paper assesses the legislative structure and administration of digital service taxes in relation to the canons of taxation. The findings of the review were conflicting. While certain aspects, motives, and possible outcomes of the taxes upheld the principles of taxation, some of these were conflicting with the principles. This could possibly be linked to variations in the economic, political, and social contexts in African countries and between developed and developing countries. The study recommends that while digital service taxes are an irrefutable necessity to tap tax revenues from the digital economy, African countries should ensure that equity, neutrality, economy, and efficiency among other principles are considered and balanced with the fundamental roles of tax policy.https://www.mdpi.com/2075-471X/11/4/57digital service taxestax revenuecanonsdigital economyAfrica |
| spellingShingle | Favourate Y. Mpofu Tankiso Moloi Direct Digital Services Taxes in Africa and the Canons of Taxation Laws digital service taxes tax revenue canons digital economy Africa |
| title | Direct Digital Services Taxes in Africa and the Canons of Taxation |
| title_full | Direct Digital Services Taxes in Africa and the Canons of Taxation |
| title_fullStr | Direct Digital Services Taxes in Africa and the Canons of Taxation |
| title_full_unstemmed | Direct Digital Services Taxes in Africa and the Canons of Taxation |
| title_short | Direct Digital Services Taxes in Africa and the Canons of Taxation |
| title_sort | direct digital services taxes in africa and the canons of taxation |
| topic | digital service taxes tax revenue canons digital economy Africa |
| url | https://www.mdpi.com/2075-471X/11/4/57 |
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