Digital Services Taxes (DST) are a new class of taxes being implemented around the world to tackle the perceived unfairness of non-resident digital companies to sell across borders without being liable to local corporate income taxes. They are typically a percentage charge of turnover from in-scope activities, with an initial sales threshold based on in-country and global income. Below is VAT Calc’s global tracker of proposed and implemented DST’s.
The OECD’s Inclusive Framework on Base Erosion and Profit Shifting proposal has been adopted by almost 140 countries, as well as the G7 and G20, to reform and harmonise the tax treatment of foreign digital income and minimum tax rates. This includes ‘Pillar 1’ which would provide certainty over the rules for DST’s and the right to tax non-resident local sales. Note: VAT on digital services is not included.
Europe Digital Services Taxes (DST)
| Country | Status | Rate | Annual sales threshold | Scope | |
| In-country income | Global income | ||||
| EU Digital Levy | Paused | 3% | EU €50m | €750m | Marketplaces; advertising |
| Austria | Jan 2020 | 5% | €25m | €750m | Advertising |
| Belgium | Paused | 3% | €5m | €750m | Advertising; Intermediation; Data Transmission |
| Czech | Jan 2022 | 5% | CZK 100m | €750m | Advertising; digital services |
| France | Jan 2019 | 3% | €25m | €750m | Digital interface; advertising; user data |
| Greece | Jul 2019 | Nil | n/a | Tourist accomodation | |
| Hungary | Jul 2019 | 0% to Dec 2022; then 7.5% | HUF 100m | n/a | Media content; Advertising |
| Italy | Jan 2020 | 3% | €5.5m | €750m | Advertising; digital interfaces; user data |
| Latvia | Jan 2022 | 3% | €750m | Digital interface; advertising; user data | |
| Norway | Proposed | Subject to progress on OECD plans | |||
| Poland | Jul 2020 | 1.5% | Streaming media and Audiovisual media service and audiovisual commercial communication | ||
| Slovakia | Proposed | Advertising; user data | |||
| Spain | Jan 2021 | 3% | €3m | €750m | Advertising; user data |
| Turkey | Mar 2020 | 7.5% | TRY 20m | €750m | Advertising; Content; social media |
| UK | Apr 2020 | 2% | UK £25m | £500m | Marketplaces; Social media; search engines |
Asia Pacific Digital Services Taxes (DST)
| Country | Status | Rate | Annual sales threshold | Scope | |
| In-country income | Global income | ||||
| India | Jun 2016 | 6% | Rs 2cores | n/a | Advertising |
| India | Apr 2020 | 2% | INR 20m | n/a | Goods and digital services sellers and facilitating marketplaces |
| Indonesia | Mar 2020 | TBC | E-commerce | ||
| New Zealand | Proposed | 2-3% | NZ$3.5m | NZ$1.1bn | Social media; Content sharing; Search engine; user data; Intermediation; |
| Pakistan | Sep 2021 | 2% | Nil | Nil | Withholding tax on marketplaces |
| Kyrgystan | Jan 2022 | 2% | Nil | Nil | Tax on digital services B2B and B2C |
| Sierra Leone | Jan 2021 | 1.5% | |||
| Vietnam | 2021 TBC | 1.5% | Ecommerce tax on marketplace revenues | ||
Americas Digital Services Taxes (DST)
| Country | Status | Rate | Annual sales threshold | Scope | |
| In-country income | Global income | ||||
| Argentina | Dec 2020 | 5%, 10%, 15% | Online gambling | ||
| Brazil - 1 | Proposed | 1-5% | BRL 100m | BRL 3bn | Advertising; user data; interfaces; |
| Brazil - 2 | Proposed | 3% on COFINS | BRL 78m | $240m | Advertising; platform services for selling goods and services |
| Brazil - 3 | Proposed | 3% | BRL 4.5bn | Advertising; platform interaction services; data | |
| Brazil - 4 | Proposed | 3% - 10% | BRL 100m | Media; apps; gaming; gambling (10%); software | |
| Brazil - 5 | Proposed | 3% | Advertising; user data; payment platforms; media | ||
| Canada | Jan 2022 proposal | 3% | CAD 20m | €750m | Advertising, online marketplaces, social media and the sale/licensing of user data. |
| Costa Rica | Nov 2019 | Tourist accommodation rentals | |||
| Paraguay | Jan 2021 | 4.5% | Non-resident: media; gaming; data processing; advertising; gambling; software | ||
| Uruguay | Jan 2018 | Income Tax | Digital services Non-residents | ||
Africa & Middle East Digital Services Taxes (DST)
| Country | Status | Rate | Annual sales threshold | Scope | |
| In-country income | Global income | ||||
| Kenya | Jan 2021 | 1.5% | n/a | nil | Digital interfaces services, including most non-resident e-services |
| Israel | Proposed | 3%-5% | Digital interface; advertising; user data | ||
| South Africa | Proposed | ||||
| Tunisia | Jan 2020 | 3% | Apps; digital services (non-resident only) | ||
| Zimbabwe | Jan 2019 | 5% | Digital and ecommerce | ||
