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Embedding A.I. in the next-generation tax policy design

  • Ignacio Longarte profile
    Ignacio Longarte
    13 July 2018 - updated 2 years ago
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    Total votes: 0

There is tense international debate around digital economy taxation that is fragmenting economic blocks.
But if there is a regulation that can be coverted to code, that is tax.

In my perspective, the only way forward in a digitally enabled global economy would be based in making a common agreement for states rendering a small portion of their tax sovereignty as a starting point.  

We should open a separate greenfield work group to re-design key principles based on this way of thinking and with A.I. in the tax regs-ADN to enable automatic execution of such sovereignty portion. 

For more info, please find here a paper I have recentily published in LAWAHEAD hub from IE Law School in Madrid.

https://lawahead.ie.edu/embedding-a-i-and-block-chain-in-the-next-generation-digitalized-economy-tax-policy-design/

Any comments/perspectives are appreciated. 

BR, Ignacio


 

 

Tags: 
policydigital economytaxation

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Ignacio Longarte's picture
Ignacio Longarte,
19/07/2018 11:47

Hi Jaroslav

Thanks for reviewing the paper.  Good questions. 

The globally agreed upon review of tax law you mention would be the ideal first step, but if all the parties (say OECD members initially) were to agree to do a greenfield reset and questioning things like "do we stil need both indirect and direct taxes ??", and other structural points.
The current global and EU initiatives are not that greenfield but pointing to adjust the traditional international tax, VAT & Transfer Pricing principles we have to the digital economy. Gradual change is logical considering the complexity and number of parties to the issue, but some of those parties could agree to invest in a separate greenfield redesign to be tested, starting by defining the principles first and the minimum data needed and I am sure we would find MNEs volunteering to participate in controlled pilots.    

And to you other question, yes, I think we would need a supra-national body. The benefit is that enforcement is machine driven,...but that body would have to supervise the underlying tech foundation and ensure integrity and the robust application of the initial steps, even if they are based in distributed ledger techs...Public-Private close cooperation would be needed.

With kind regards

Ignacio 

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Jaroslav BARAN's picture
Jaroslav BARAN,
18/07/2018 11:58

Hello Ignacio,

Thank you for sharing your paper. I agree that this is a highly complex interdisciplinary issue.

In your opinion, is the first step in solving the issue of MNE taxation a definition of the minimal data standards that you mention, or rather finding an internationa entity that would be able to implement and enforce these standards globally? Or would a globally agreed upon revision of tax law be the first step?

Kind regards,

Jaroslav

Total votes: 0