The growth of the gig economy poses new
challenges for tax administrations, especially for transactions between parties
in several countries. Assumedly, many self-employed gig workers do not
regularly report their platform income to the tax authorities. However, the gig
economy can also provide opportunities in terms of collecting taxes and social
security contributions. Transactions and related payments take place in
electronic form, which can increase transparency and reduce the compliance
burden for taxpayers and administrations.
Against this background, both the EU
Commission and the OECD have launched initiatives to establish standardised reporting
obligations on platform operators, as well as the basis for the cross-border
exchange of information between tax administrations. In addition, the OECD specifically
highlights the option of also making the new procedures available to social
The OECD has presented its recommendations as part of a public
consultation on ‘Model Rules for Reporting for Platform Operators with respect
to Sellers in the Sharing and Gig Economy’ launched on 19 February. The
consultation document is available here.
Commission launched a very similar initiative on 7 February with an Inception
Impact Assessment of a ‘Proposal for a Council Directive amending Directive
2011/16/EU as regards measures to strengthen the exchange of information framework
in the field of taxation’. The document can be downloaded here.
The aim of the Commission initiative is to
improve cooperation between national tax authorities, while avoiding unilateral
reporting rules at Member State level. Similar
to the OECD proposal, this would be underpinned by EU-wide standardised
reporting rules for platforms. The Commission’s preference is to adapt Directive
2011/16 as a means of achieving this, including addressing the question of
whether only platforms located in the EU should be covered or all platforms
The Commission has announced that it will
consult national tax authorities starting in February. In addition, the
Commission will organise a high-level stakeholder consultation in April as part
of its conference on ‘Tax Compliance in a Digitalised World’.
The German Social Insurance welcomes the
OECD initiative. In order to improve social protection, income from
self-employment should be subject to compulsory insurance in Germany as soon as
possible. This also applies to income generated via electronic platforms, even
if this is often only secondary income. The reporting rules proposed by the
OECD would be an important way of detecting deliberate or unintentional failure
to pay social security contributions. The proposal to also use the data for social
security purposes is therefore highly relevant in Germany and should be pursued
of the German Social Insurance can be read here.