Abstract
Digitalization is revolutionizing our economies. The volume of digital payments has increased exponentially, fueled by electronic commerce and financial transactions. Giant internet platforms are now dominant players at the global level and manage to avoid most taxes. New payment service providers are undermining the traditional business model of banks. We lack a conceptual framework for guiding the regulatory and taxation reforms that are needed to adapt to this digital revolution. I will contribute to provide such a framework by examining 3 questions:
Digital payments: regulation and/or public provision?
I will study how the banking regulatory model, focused essentially on prudential and monetary issues, needs to be adapted to take care of antitrust and privacy issues. I will also examine if the public provision of digital payments can eliminate the risk of domination of the payments industry by a few private platforms.
Should we tax digital payments?
Current taxes on digital services and financial transactions are, by and large, evaded by businesses. An alternative is to introduce a (small) tax on all digital payments. It could generate a sizable revenue, would be easy to implement, difficult to avoid, but would also generate distortions. I will incorporate payments into a general equilibrium model, and carry out a cost benefit analysis of this “tax for the 21st century”.
Multidimensional taxation in a digitalized economy
Traditional sectors are deeply impacted by the digitalization of the economy. Thus, it would be appropriate to consider a global reform of the tax system. However, an important theoretical hurdle is to find a way to solve general screening problems with multiple instruments and multiple dimensions of heterogeneity, which nobody has done so far. Based on a recent breakthrough in numerical methods, I will provide such a general solution, and apply it to multidimensional taxation in a digitalized economy.
Description du projet: Lutter contre la numérisation de l’économie
Les jours où nous effectuions nos ventes et transactions financières en personne sont bientôt révolus, alors que les outils et plateformes numérisés deviennent la norme. Mais, depuis leur apparition, les entreprises et les citoyens évitent de plus en plus la plupart des systèmes fiscaux et bancaires traditionnels. La question est de savoir ce dont nous avons besoin pour nous adapter à ce changement. Le projet DIPAMUTA, financé par l’UE, examinera la réglementation et/ou la fourniture publique de paiements numériques; une taxe potentielle sur les paiements numériques; et une imposition multidimensionnelle dans une économie numérisée. DIPAMUTA utilisera différents instruments et différentes dimensions de l’hétérogénéité qui, à leur tour, soutiendront l’impositin multidimensionnelle dans une économie numérisée.
Contact in TSE : Jean-Charles Rochet
Project Dates: 2022-2027
