Money for Nothin’: Digitalization and Fluid Tax Bases

Reprint No. 2021:22

Author(s): Mårten Blix and Emil BustosYear: 2021 Title: The European Union and the Technology Shift Chapter: 8Editor(s): Antonina Bakardjieva Engelbrekt, Karin Leijon, Anna Michalski and Lars OxelheimPublisher: Palgrave MacmillanCity: Cham Pages: 185–209
Online article (restrictions may apply)
Preliminary version

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.

Blix, Mårten and Emil Busto (2021), "Money for Nothin’: Digitalization and Fluid Tax Bases". Chapter 8, pp. 185–209 in Antonina Bakardjieva Engelbrekt, Karin Leijon, Anna Michalski and Lars Oxelheim, eds., The European Union and the Technology Shift. Cham: Palgrave Macmillan.

Interdisciplinary European Studies

The European Union and the Return of the Nation State


This book explores the complex and ever-changing relationship between the European Union and its member states. The recent surge in tension in this relationship has been prompted by the actions of some member state governments as they question fundamental EU values and principles and refuse to implement common decisions seemingly on the basis of narrowly defined national interests.

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