Special Features of the UN Model Convention

1. S. 330Tax Challenges of the Digitalized Economy

One of the most important and prominent changes in the United Nations Model Double Tax Convention 2017 (UN Model 2017), released on 18^th May 2018, is the introduction of a new article: Art. 12A Fees for Technical Services (art. 12A UN Model). Although it was not necessarily designed to deal with tax challenges related to the digitalized economy, art. 12A UN Model could be the “joker in the pack” of the UN Model 2017. This thesis will discuss the potential of art. 12A UN Model and see whether it is a good response to the tax challenges created by the digitized economy. In order to properly evaluate Art. 12A UN with respect to the tax challenges of the digital economy, the first step is to describe the “digitalized economy” and explain the current challenges that the digitalized economy creates for (international) taxation.

1.1. What is the Digitalized Economy?

The “Digitalized Economy” is a concept widely referred to, also in the (international) tax literature. The question remains what exactly is – or what characterizes – this digitalized economy. Indisputably, technology is having an increasing impact on our lives, since we are more and mo...