Research On Legal Issues Of China’s Tax Jurisdiction In The Digital Economy

E-commerce,as an early form of the digital economy,has been the focus of the world as early as the end of the 20 th century.With the rapid development of information technology,digital economy has developed into a variety of business models,and infiltrated all aspects of the economy.While promoting economic prosperity,promoting the development of world trade and improving the global quality of life,it also brings some negative effects.In the Digital Economy Era,the International traditional tax rules are in trouble,and the theory of tax jurisdiction has been greatly impacted.Tax Jurisdiction is the core of international tax law system,which has the responsibility of coordinating tax jurisdiction,avoiding or even eliminating international double taxation,and influencing the status of tax benefit distribution.In the era of Digital Economy,with the development of Internet technology,the business model has undergone great changes.The increase of flexibility and complexity makes the connection between trading activities and specific physical sites more and more weak.The invisibility and mobility of the digital economy are becoming more and more evident,and enterprises can easily conduct business activities with any place in the world through communication technology.This makes the determination of tax jurisdiction of the connecting factors gradually disappear or even disappear.The anonymity and mobility of the business model of the Digital Economy make the identification of resident status difficult,and the identification of Permanent establishment also encounters difficulties.At present,the measures of all countries are basically focused on the original rule loophole,which is inadequate in the context of the rapid development of digital economy.Developing countries in particular,as digital economy importing countries,the loss of tax revenue is very serious.The great challenge of the Digital Economy to the international tax rules has been recognized by the world.In response to this phenomenon,internationalorganizations and scholars of various countries have proposed solutions.The Organization for Economic Co-operation and Development(OECD)released its final report on the BEPS action plan in 2015.In October 2019,it published Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors.The international community still does not have a conclusive agreement on the division of tax jurisdiction.At the same time,OECD still insists on the principle of permanent establishment,and tries to perfect the new correlation rule of Significant Economic Presence.In addition to sorting out the scheme of OCED,this paper also introduces the latest international experience of the United States,the United Kingdom and other countries.China,as the world’s second largest economy and the largest developing country,has made considerable economic progress in recent years.Now,China has the dual role of data value realization and source,so we should seize the opportunity and learn from the theory and practice of International Tax Law Reform based on China’s national conditions.We should perfect the tax principle,perfect the legislation and improve the tax system to deal with the problem of tax jurisdiction brought by the digital economy,to protect our tax benefits.