The law and economics of digital taxation : challenges to traditional tax laws and principles

The article first sets out the general principles of information economics and then discusses how the characteristics of information goods present challenges to governments which continue to rely on traditional tax laws and principles that emphasize control over geographic space, character of income, and tangible goods and rights relating to them. The article also considers the tax policy implications of the previous analysis and concludes that, in the long term, certain tax principles will need to be significantly altered to address these challenges.