Abstract
This chapter analyses in what way digitalisation changes the conditions for taxation. In the 2020s, firms create value less using machines and more using intangibles, such as copyrights, R&D and soft knowledge. The chapter shows that tax bases will be more mobile and thus it will be more difficult to raise tax revenues. Though some governments have started to tax digital companies in new ways, this has spurred international conflict and tension: both the EU and the OECD are trying to reach broad international agreements; absent an agreement, the existing international system for corporate taxation may erode. Furthermore, as labour becomes more mobile and thus more elusive to tax, the funding of the welfare states is threatened. To ensure that the EU and its member states get money for somethin’, this chapter concludes that a new comprehensive tax reform is urgent.