Singapore's digital tax agenda: A matter of time

MOST corporate tax systems are based on the presumption that businesses operate in close proximity to their customers. These days, however, the reality is not so. Many businesses operate on a regional or even worldwide level. The Internet, more than anything else, has enabled businesses to supply markets without the need for a local presence.

These developments are putting pressure on the way taxes are currently levied and have prompted the question of whether existing tax systems are sufficiently equipped to operate effectively.

Because the digital component is often an integral part of the business, the material difference between tech and traditional businesses is quickly diminishing. Therefore, it is also becoming more difficult to separate the tech and non-tech components of a business. Considering that, it may not be sensible to seek such separation for tax purposes.