Taxation of data: the next step

Key points

• Should there be a tax on personal data?
• Environmental reasons could underlie such a tax.
• Is there the political will to implement the required legislation?
• The taxes on petrol and coal are simply earlier examples of a tax on data.
• Practical problems and solutions.
• The cost of the tax could be passed to customers and other consumers.
• The possibility that a tax on data could act as a brake on innovation.

With the General Data Protection Regulation (GDPR) celebrating its first anniversary the timing is ideal for capitalising on this great success. As a next step perhaps we should consider taxing data?

It is true that the international tax system is facing a crucial transition phase related to several massive tax challenges. One of the biggest questions is where the profits generated by the digital industry should be taxed? The answer provided by GDPR may be a useful one: ‘This regulation applies to the processing...