The Online Advertising Tax as the Foundation of a Public Service Internet

Fuchs, Christian. 2018. The Online Advertising Tax as the Foundation of a Public Service Internet. London: University of Westminster Press. Gratis open access format & purchase of paperback edition

Short version: Fuchs, Christian. 2018. The Online Advertising Tax. A Digital Policy Innovation. CAMRI Policy Briefs No. 1. London: University of Westminster Press. Gratis open access format & purchase of paperback edition

Google and Facebook currently control close to two-thirds of global advertising revenue. While dominating the online advertising market, these two companies have thus far avoided paying adequate taxes.

This CAMRI policy report/brief presents a new policy innovation, the online advertising tax. Considering the key role of user activity and user data for the value of Google and Facebook’s services, it explains how digital advertising companies’ revenues could be taxed based on the respective country in which targeted users are located.

The author reviews existing policy arguments and policy options and sets out practical steps to ensure that tax avoidance by online advertising companies is mitigated. Furthermore, he illustrates how tax revenues could be used to support public service internet platforms.

Table of Contents

1. Introduction: Public Service Internet Platforms and the Online Advertising Tax.

2. The Rise of Online Advertising

3. The Google and Facebook Online Advertising Duopoly

4. Google and Facebook’s Tax Avoidance Strategies

5. The Tax Avoidance Inquiry in the British House of Commons

6. Example Policy Measures for Countering Online Corporations’ Tax Avoidance: Voluntary Corporate Self-Regulation, the ‘Google Tax’ (Diverted Profits Tax), and the Digital Permanent Establishment
7. A Method For Taxing Online Advertising and Digital Value
8. Towards A Public Service Internet: Funding, Infrastructure and Formats

9. Conclusions and Discussion

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