BEPS Action 1 — Addressing the tax challenges of the digital economy

Over the years, advances in information and communications technology have revolutionized and disrupted the business models of companies, regardless of size. In retail, for example, customers can now place orders online. In manufacturing, production processes can now be monitored through automated systems. In health care, it is now possible to conduct remote diagnosis. In media, new avenues have been developed for distribution and user participation — think user-generated content and social networking. These new models, which are largely characterized by mobility with respect to intangibles, users, and business functions, or use of multi-sided business models, make up for what is now called the Digital Economy.