The Impact of the Growth of the Sharing and Gig Economy on VAT/GST Policy and Administration
This report aims at assisting tax authorities in designing and implementing an effective
Value Added Tax/Goods and Services Tax (VAT/GST) policy response to the growth of
the sharing and gig economy. The rise of this phenomenon, powered by digital platforms,
has transformed a number of industries within just a few short years. It involves
large numbers of new economic operators (often private individuals), who monetise
(often) underutilised goods and services by offering these, via digital platforms,
for temporary (“shared”) use by primarily private consumers. Questions have been raised
whether existing VAT/GST policy and administration frameworks are sufficiently capable
of dealing with this new economic reality notably with a view to protecting VAT/GST
revenue and minimising economic distortions. This report sets out the core components
of a comprehensive VAT/GST policy strategy for tax authorities to consider in response.
It analyses the key features of the sharing and gig economy and its main business
models; identifies the associated VAT/GST challenges and opportunities; and presents
a wide range of possible measures and approaches to support an effective policy response.
This includes detailed guidance on the possible role of digital platforms in facilitating
and enhancing VAT/GST compliance in the sharing and gig economy.
Published on April 19, 2021Also available in: French