P2P Taxes Must be Considered Now

August 11, 2017 International Tax Cooperation

p2p taxationWASHINGTON D.C. – Governments can longer ignore the growing influence of the global P2P economy and must choose how they will tax such businesses in the future.

The International Monetary Fund has released a new working paper which prompts governments around the world to consider the taxation measures that they will implement in regards to P-2-P economies and businesses.

Over the last several years, peer-to-peer businesses have played an increasingly important role in the economy.

However, the nature of peer-to-peer business means that the fundamentals of taxation that governments have relied on for decades are now being disrupted.

It was noted that the disruption comes from the comparative ease of avoiding tax obligations on incomes earned through P2P activity.

Further, P2P businesses have changed the distributions of incomes from business, providing more cash flows to small businesses and individuals.

In the paper it was acknowledged that collecting tax revenues from small businesses is more difficult and less effective than collecting from established large business.

Government were urged to begin consideration of whether their future tax policies will be set to hinder P-2-P business, in order to support established practices, or whether new taxes will be aimed at helping the up and coming generation of the new businesses.