2020, Vol. 3, Issue 2

author(s)
Dr. Santosh Kumar Yadav

abstract
Digital economy refers to an economy that is based on digital computing technologies although we increasingly perceive this as conducting business through markets based on the internet and the World Wide Web. The digital economy is also sometimes called the Internet Economy, New Economy or Web Economy. In a nutshell, it refers to an economy based on digital technologies. In the last decade, there has been a paradigm shift in the way of conducting business. Today, the biggest cab aggregator Uber does not own any cab, the largest accommodation provider Airbnb does not own any apartments and many other frontiers like make my trip, Amazon, Flipkart, Paytm, etc. do not function the way conventional businesses functioned but they thrive on the digital technology. The current tax rules were devised decades ago based on the functionality of the brick and mortar economy. However, with the advent of the digital economy the present tax regime stands redundant. The profits of the digital businesses have been increasing alarmingly, but there do not exist commensurate tax laws to tax such profits. Accordingly, it is need of the hour for all the countries to devise and revamp their tax laws, as the digital economy is ripe for taxation.