Last week, negotiations for a new global tax regime for digital platforms collapsed. The negotiations, hosted by the Organisation for Economic Co-operation and Development (OECD), aimed to ensure that big tech platforms pay part of their corporate income taxes in the country where their users are located, including through the incorporation of a minimum level of taxation across the globe.
Though almost 140 governments were formally participating in the negotiation, most media reports in the Global North framed their articles as either a failure of the European Union to get the US representatives to agree to a more equitable framework, or as the US arbitrarily pulling out. What is certain is that the US government has issued threats that if governments move towards implementing their own digital tax schemes unilaterally, the US will retaliate with tariffs. This is a credible threat, especially when President Trump has exposed an aggressively erratic foreign policy.
A debate on taxation regimes might seem like an obscure technical matter reserved for grey accountants. But it is much more than this, so bear with me. This debate operates as a magnifying glass over the growing crack emerging in the global information system that we call the world wide web. It is perhaps the clearest signal that the web is on a crash course that could lead to a permanent fragmentation, which would undoubtedly be a bad thing. But first, let’s look at why this issue is so pressing today.
