Indonesia has one of the fastest-growing and most dynamic crypto-asset markets, but the tax consequences of its simplified and blanket regime remain underexplored. This article analyses the evolution of Indonesia’s crypto-asset taxation framework from intangible commodities to digital financial assets. The latest reclassification represents a pivotal regulatory transition by eliminating VAT, applying a single transaction tax, redefining crypto-assets as financial instruments, and leaving central bank digital currencies (CBDCs) untaxed. This study employs a doctrinal and comparative analysis with India and the European Union (EU) countries and ascertains that the taxonomy change largely constitutes a nominal redefinition as the tax treatment continues to mirror commodity-based levies. It highlights key pitfalls in Indonesia’s simplified framework (including ambiguous definitions, regressive burdens, high reliance on withholding agents, and unworkable deterrent rates). It also underscores the opportunities and risks in aligning crypto-asset taxation with financial market regulation and the Organization of Economic Co-operation and Development (OECD) Crypto-Asset Reporting Framework (CARF). The study argues that sustainable reform requires adopting functionally grounded classifications and methods of tax treatment that balance efficiency, equity, and adaptability in Indonesia’s rapidly expanding digital economy. These findings may extend to other emerging economies with robust and fast-growing crypto-asset markets where governments face similar challenges in balancing innovation, regulation, and taxation.
The emergence of cryptocurrencies almost twenty years ago has created unprecedented challenges to dozens of tax systems globally and to thousands of bilateral tax treaties. Despite widespread use, tax authorities from all over the world have struggled to develop comprehensive regulatory tax frameworks addressing the unique characteristics of the cryptographic assets including their virtual and decentralized nature, their high price volatility, their pseudo-anonymity nature, and high liquidity. Without exception, most of the OECD Member States have currently only issued guidance on cryptographic taxation based on existing statutes that had been developed in a much less cross-border capital mobile reality and when national economies were not as open and as impacted by cross-border trade, and nonetheless have not yet developed a novel tailored comprehensive tax legislation for taxing crypto dealings. The article examines critical deficiencies in the current tax regulatory frameworks, particularly regarding cross-border taxation both within domestic tax systems of developed countries and within the cross-border tax rules codified in all three bilateral model tax conventions (MTCs). It proposes targeted measures to preserve the crypto tax base as the increasing cross-border mobility of crypto dealings threatens to unjustly undermine countries’ ability to effectively exercise their taxing rights over crypto income and gains.
The European Union (EU) list of non-cooperative jurisdictions for tax purposes, introduced in 2017, screens non-EU countries for alignment with OECD and EU tax standards to curb harmful tax competition. Non-compliance results in blacklisting, with significant reputational and economic consequences. This paper employs a qualitative empirical methodology to examine the experience and perceptions of Namibia, Mauritius, and Seychelles, exemplifying the challenges faced by developing countries in responding to externally imposed tax reforms. Among other trends, it identifies three compliance strategies – apparent, reluctant, and pre-emptive – reflecting semi-compliance driven by reputational concerns. Based on empirical findings, the paper exposes the EU list’s coercive nature and its disregard for developmental priorities, leading to unstable, short-term policy changes. Using a decolonizing lens, the paper interrogates issues of procedural and substantive fairness, arguing that, while the EU tax list aims to foster tax coordination, it reinforces global inequalities, hindering inclusive and equitable cooperation; it therefore risks marginalizing developing countries and undermining its own legitimacy in advancing global tax justice. The paper contributes new empirical data, proposes an analytical framework for assessing compliance responses, and offers recommendations for both (African) developing countries and the EU. It calls for a more equitable and collaborative model of the EU tax list for international tax governance.
Zucman’s suggestion of a minimum tax on the ultra-wealthy is welcome in the quest for tax justice. This suggestion has the potential to address the wealth gap and to raise much-needed domestic revenue. However, it is couched within the context of a disharmonized international tax framework which may be ill equipped to address challenges such as multiple nationalities and residencies. This article argues that the adequacy of Zucman’s suggestion should be weighed against the scales of fiscal legitimacy and calls for the establishment of a global fiscal architecture.
This paper argues that an annual wealth tax is poorly matched to the goals most often invoked by its proponents – reducing inequality, protecting democracy, and strengthening social trust. The paper develops three difficulties that make an annual wealth tax an ineffective or counterproductive instrument: a valuation problem that cannot be solved by administrative refinement; a mismatch between ambitious democratic and social ends and modest fiscal means; and incentive effects that discourage saving, investment, and entrepreneurship. As an alternative, it proposes reforms within the income-tax base that target economic rents – the excess returns that fund durable political influence and reflect unfair, policy-created scarcities. Two design changes are emphasized: treating death as a realization event to reach decades of accrued gains and adopting a minimum tax on accrued gains for the ultra-wealthy, with mark-to-market for liquid assets and deferral with interest for others. Together these reforms better align means with ends, addressing both fairness and democracy without the knowledge and incentive costs of a wealth tax.
This study explores the alignment of digital services taxes (DSTs) with the non-discrimination provisions outlined in the General Agreement on Trade in Services (GATS) with particular attention being paid to the concept of ‘likeness’. It focuses on the Italian DST as a representative case and examines whether this measure differentiates between ‘like’ digital services and suppliers in accordance with Articles II (Most-Favoured Nation (MFN)) and XVII (National Treatment (NT)). The analysis employs a doctrinal approach and integrates a comprehensive examination of World Trade Organization (WTO) law with relevant case law and tax scholarship. This reveals that revenue thresholds and carve-outs introduce structural asymmetries in the competitive relationship between services and suppliers that may be regarded as ‘like’ under WTO criteria. The Italian DST is ostensibly neutral but disproportionately impacts large multinational platforms thereby posing a significant risk of de facto discrimination under current jurisprudence. This study expands on this insight and argues that a model DST law crafted in accordance with the GATS principles is essential to ensure that future digital taxation initiatives fulfil their fiscal objectives without violating multilateral trade regulations.
