For some years now, particularly in the last twenty years, the world economy has been revolutionized by some web giants such as: Google, Amazon, Meta, Apple, etc... Without any doubt, their presence has transformed the way we do any action, just think about communication or buying. In relation to this, in this space we will focus on the change that has brought about the way in which profit is generated or, even simply, economic value. What they offer on the market is not a material asset (such as the case of a car or a refrigerator), but digital: it is data, content, online services; The phenomenon implies that these 'non-physical' goods do not need to be 'jobs bases' as warehouses or factories, on the contrary their only need is represented by the interactions of users within a server. Apparently, it would seem a very immediate system, a remarkable resource for the acceleration of the circulation of money, however, this activity raises not a few doubts especially regarding the taxation of the same. Why this? The problem arises because almost the entire number of the world tax systems is still based on the physical presence, the so-called "stable organization" to decide where it is possible to tax the enterprise, and this produces, in the field of the net, a large gain in a given state without having a headquarters, nor employees. It is evident that, in doing so, the multinationals involved pay much less taxes than any company traditionally understood (with production and offices on the territory). We can, in fact, analyse what has long been the legislation of our country regarding the conditions for which it is possible to tax a company. Italy→art.162 of TUIR (Text of Income Tax) [N.B. valid from 2004 to 2018]

1. Without prejudice to Article 169, for the purposes of income taxes and regional tax on productive activities referred to in Legislative Decree No 446, the term "stable organisation" shall mean a fixed place of business by which the non-resident undertaking exercises its activity in whole or in part on the territory of the State.

2. The term 'stable organisation' shall include in particular: a place of management; a branch; an office; a workshop; a laboratory; a mine, oil or natural gas lay-up, a quarry or other place of extraction of natural resources, including in areas outside territorial waters where, in accordance with customary international law and national legislation on the exploration and exploitation of natural resources, the State may exercise rights relating to the seabed, its subsoil and its natural resources.

How do they get around the system?

First, it must be borne in mind that multinational companies are by definition located in several countries and, thanks to this feature, they are able to easily transfer their profits from one state to another, clearly going to prefer the state with less incisive taxation.

The Double Irish and Dutch Sandwich method

These companies, with the aim of reducing the tax impact, have implemented two different tax management strategies: while the first uses Irish legislation, the second uses the Netherlands as an intermediate step. In the first hypothesis we have a company that manages commercial transactions and another, registered in Ireland even if fiscally resident in a tax haven, which holds intellectual property, which allows us to perceive profits with a very low tax. Dutch Sandwich engages in this mechanism, adding, however, a company based in the Netherlands to the two Irish. This serves to avoid taxes on royalties and transactions. So if the Double Irish is focusing on the tax residence of companies, Dutch Sandwich allows to avoid withholding tax on profit transfers, exploiting tax agreements between Ireland and the Netherlands, through which money passes before being sent to jurisdictions with minimum or zero taxation. Of this the most well-known case is Google, which has benefited from these strategies. This company, in fact, initially transferred the profits deriving from various activities to an Irish company, naturally always owned by Google (Google Ireland Holdings), which owned the IP rights. At a later stage, the company passed the profits to a second company, which was resident fiscally in some islands of the Caribbean. However, these transactions had to go through a third branch in the Netherlands, Google Netherlands Holdings, all to prevent possible taxation on payments, and certainly these efforts were not in vain since they could lower the tax rate to less than 2.4%. However, as was expected, these practices became a highly debated topic among politicians and we had a real turning point when the United States and the European Union, after having estimated all losses, began to urge the international community to implement reforms, thus bringing Ireland to correct the loopholes that made this system feasible: from now on, all companies must be resident tax-based in Ireland.

Webtax proposals

The proposal for a possible ...Webtax was officially born in 2013 from a collaboration between the European Commission and the OECD in view of the BEPS (Base Erosion and Profit Shifting) project, that is a series of initiatives to accentuate the fight against the erosion of the tax base and the shift of profits. What does all this mean? Very simply it is a question of taxing the profits not where the companies move them, but where they are actually generated.

In 2018 two legislative proposals are put forward by the Commission:

· temporary fee→Digital Services Tax (DST)

· long-term reform to create a common tax base for this type of activity (digital permanent establishment)

DST:

1. 3% rate on revenues from: online advertising, digital platform brokerage and sales of user-generated data

2. Minimum threshold: companies with revenues above 750 mln

The Commission estimated that the reform would generate around EUR 5 million per year of taxes and, furthermore, a system would have been established which would have laid the foundations for a permanent global reform, but this did not happen, in fact, to be approved, it would have required a unanimous vote of 27 Member States, which was not achieved precisely because some countries, fearing to lose competitiveness, opposed it (Ireland, Luxembourg, the Netherlands). In the face of this problem, it was decided to allow individual states to act autonomously, while maintaining a criterion of compatibility with European international law.

In Italy

A kind of draft Web Tax in Italy was born in 2013 and takes the name of \Google Tax  , although it was extended, in general, to digital companies. The goal was to impose in Italy the invoice of those gains from services sold to Italian citizens. So, if a foreign company sold advertising to an Italian company, the passage had to pass for an Italian company of the same group and be taxed in our country. This option, unfortunately, had not few criticalities: it risked to violate the European rules on freedom of establishment, it was difficult to apply and could compromise the country at diplomatic level (USA). At this point, between 2019 and 2020 a tax substantially identical to the Digital Services Tax, different only because its applicability was valid within our borders. We can now ask ourselves: is this reform giving results? Can we say that it has been partially satisfied since in 2022 it has produced as much as EUR 300 million, although we must bear in mind that the objective will only be fully achieved when there is supranational legislation. Are we so far from this perspective? Actually not much if we consider the OECD-G20 agreement of 2021 so that more than 135 countries (represent 90% of world GDP) have joined a reform of the tax system

International.

This agreement is divided into:

· Pillar One: part of the profits of the largest multinationals must be redistributed to the countries of origin of the users, even without a location, therefore going to update the concept of 'stable organization' which we discussed at the beginning;

· Pillar Two: minimum global tax: if a multinational pays less than 15%, you can take the difference (top-up tax)

We say that its application is still under development because, if in 2022 the Pillar Two was validated and made a real directive in force since 2024, instead, the Pillar One still needs to be defined because, in order to succeed, there is a need for a treaty that all states must sign and ratify to distribute profits. Until then, states will continue to maintain their national Web Tax.