U-turn by the U.S. Trade Representative to rein in the Big Tech Digital Trade Agenda
15 November 2023
The landmark shift by the U.S. Trade Rrepresentative to set aside four proposals to ensure “policy space” for the U.S. is a welcomed development under the Joint Statement Initiative (JSI) negotiations on E-commerce on the side lines of the WTO. This decision validates the positions taken by governments in the Global South for the last seven years. There remain several provisions in the negotiating text that will be detrimental to the development of domestic digital industries in developing countries.
Taxing Big Tech: Policy Options for Developing Countries
By Abdul Muheet Chowdhary and Sébastien Babou Diasso
Even as the COVID-19 crisis wreaked havoc on the global economy, it gave rise to a small set of winners, namely Big Tech. The increasing prevalence of remote work and an acceleration of the digitalization of the economy allowed Big Tech companies to raise enormous revenues during the pandemic, which in some cases dwarfed the gross domestic product (GDP) of several countries. This policy brief explores the rising untaxed profits of Big Tech in particular, and the digitalized economy in general, and explains why the existing rules are insufficient. It also critically examines the solution that has been devised by the Organisation for Economic Co-operation and Development (OECD), an intergovernmental organization of developed countries. Finally, it outlines alternative policy options that are more suitable for developing countries to tax the profits of Big Tech.