Session
Organizer 1: Anri van der Spuy, Research ICT Africa
Organizer 2: Deborah Brown, Association for Progressive Communications
Speaker 1: Franz von Weizsaecker, Private Sector, Western European and Others Group (WEOG)
Speaker 2: Gandhi Emilar, Private Sector, African Group
Speaker 3: Alison Gillwald, Civil Society, African Group
Speaker 4: Juliet Nanfuka, Civil Society, African Group
Speaker 5: Gus Rossi, Civil Society, Western European and Others Group (WEOG)
Deborah Brown, Civil Society, Western European and Others Group (WEOG)
Anri van der Spuy, Civil Society, African Group
Anri van der Spuy, Intergovernmental Organization, Western European and Others Group (WEOG)
Round Table - U-shape - 90 Min
How do policies that impose levies on Internet service providers and other Internet services (“Internet taxes”) impact digital inclusion in general and human rights and socio-economic development in particular in diverse regions? What kinds of precedents could Internet taxes policies establish, and what is the impact of different Internet taxes in different regions on the global Internet and its development? What are the motivations for imposing Internet taxes in different contexts? What are the various forms of Internet tades that are being imposed on Internet services take? Do Internet taxes contribute to economic or sustainable development? If yes, how? If not, why not? Who bears the primary onus of paying for Internet taxes - the user or the provider - and how does this impact digital inclusion?
GOAL 1: No Poverty
GOAL 3: Good Health and Well-Being
GOAL 4: Quality Education
GOAL 5: Gender Equality
GOAL 7: Affordable and Clean Energy
GOAL 8: Decent Work and Economic Growth
GOAL 9: Industry, Innovation and Infrastructure
GOAL 10: Reduced Inequalities
GOAL 11: Sustainable Cities and Communities
GOAL 12: Responsible Production and Consumption
GOAL 16: Peace, Justice and Strong Institutions
GOAL 17: Partnerships for the Goals
Updated speaker list (as of 26 November 2019):
Franz von Weizsaecker, Private Sector, Western European and Others Group (WEOG)
Michael Kende, Academic, Western European and Others Group (WEOG)
Alison Gillwald, Civil Society, African Group
Juliet Nanfuka, Civil Society, African GroupRapporteur: Sarah Kiden
Online moderator: Raymond Onuoha
Description: The taxation of popular Internet services, including of various digital services, social media use and voice of IP (VoIP) calls, is becoming more prevalent in a number of countries and regions. While the reasons and motivations for imposing taxes differ in each case, it is worrying that little attention is paid to global implications and the risk of setting policy precedents for taxation and other regulation of Internet services. For example, in developing regions like Africa, these measures are imposed for reasons ranging from the need to augment dwindling telco revenue or to stifle dissent and even gossip - thus posing a significant threat to digital rights, digital inclusion and socio-economic development. Policy proposals in regions like Europe aim to enable fairer and more competitive digital economies by taxing Internet conglomerates in the companies they operate (and not necessarily where they are domiciled). The proposed session will investigate recent work by the Association for Progressive Communications, Research ICT Africa, and the Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), as well as other practitioners, to understand the impact of such mechanisms on digital inclusion, human rights, sustainable development and economic growth. Stakeholders from different communities in diverse regions will have the opportunity to reflect on lessons learned, and to relate them to evidence from their respective regions on how taxations and deployed, and for what reasons. Finally, stakeholders will investigate the potential harms that may arise from imposing such levies in both developed and developing contexts, with the aim of making general recommendations for policymakers considering the use of such levies in the future.
Expected Outcomes: The main goal of this collaborative session is to share findings from different organizations about the ways in which taxes on popular Internet applications and services (especially social media) are being employed; the types of levies popularly used (e.g. licence fees, sin taxes, or registration fees); the motivation governments have for deploying them; and the potential impact of such levies on digital inclusion, human rights, and socio-economic development. By bringing together diverse practitioners who are working on the issue from different perspectives in developed and developing regions alike, the session’s primary objective is to drive evidence-based policymaking on the issue of digital taxation by illustrating how such regulations may limit the positive potential of digital inclusion for economic and sustainable development, social progress, and human rights in diverse contexts. Following the session, the findings shared from diverse organizations working in the field will be consolidated and together summarised in a policy brief aimed at policymakers who may be considering the use of Internet taxes for various purposes. Such a policy brief will enable evidence-based policymaking by illustrating, with reference to the lessons learned during the session and research presented by participating organisations, such regulations may limit the positive potential of digital inclusion for economic and sustainable development, social progress, and human rights.
The moderators (offline and online), supported by the session organisers, will involve discussants and the public in the debate, and will facilitate the discussion on the topic of the session. A suggested agenda to support participation is (90 minutes): a. Opening: background presentation of the arguments and policy questions (10 minutes) b. Panelist remarks (5 minutes each: 35 minute in total) c. Discussion (30 minutes), including comments and questions from remote participants d. Closing remarks from panelists (2 minutes each: 14 minutes in total) e. Wrap-up (5 minutes)
Relevance to Theme: The proposed session will examine and explore how Internet taxes can have explicit and implicit implications for not only digital inclusion (by making it more expensive for poor people to access and use the Internet), but can thereby affect the Internet’s ability to support and enable sustainable development in line with the UN Agenda for Sustainable Development Goals. It will furthermore investigate how national and regional policies to implement digital taxes could have unforeseen and broader, global repercussions for the Internet and digital inclusion by inadvertently increasing costs for end-users.
Relevance to Internet Governance: The imposition of levies on popular Internet services, or Internet taxes, is an emerging trend in Internet governance, from Africa to Europe. Motivations for Internet taxes range from the need to augment state coffers and support local content producers and industries, to stifling dissent or preventing gossip. The result is not only a patchwork of laws and regulations that impact a region’s ability to use the Internet to support socio-economic development, but also significant implications for users’ rights and freedoms. The proposed session aims to investigate such Internet governance actions that can not only have significantly detrimental effects on digital inclusion and development, but can harm the global Internet.
The organising committee of the session will train an online moderator who will assume responsibility for giving online attendees a separate queue and microphone, which will rotate equally with the microphone in the room. The on-site moderator of the session will keep the online participation session open and will be in close communication with the workshop’s trained online moderator to share the online questions and interventions in the on-site room. The trained online moderator will collect opinions, questions and comments during the roundtable and the most relevant contributions to the discussion will be shared among the participants to the session.
Proposed Additional Tools: We plan on posing the policy questions on Twitter, Facebook and other social media (if appropriate) to encourage a Twitter debate at the same time as the session, using the official IGF hashtag for 2019.
Report
How do policies that impose levies on Internet service providers and other Internet services (“Internet taxes”) impact digital inclusion, human rights, and socio-economic development in diverse regions? What kinds of precedents could Internet taxes policies establish, and what is the impact of different Internet taxes in different regions on the global Internet and its development? Who bears the primary onus of paying for Internet taxes, and how does this impact digital inclusion, human rights, and socio-economic developments?
Overall, the session focused on policies that impose end-user levies for the use of social networking and mobile money platforms and the impact of such developments on digital inclusion, human rights and socio-economic development in Africa in particular. While the reasons and motivations for proposing and/or implementing such policies differ (ranging from political issues to supporting the revenue base or stifling dissent/ “gossip”), the taxation of popular platforms is becoming a prevalent in many countries/regions and this pauses global implications.
Participants voiced concerns that such measures interfere with freedom of expression and act as a measure to control their Internet use by governments. Governments, on the other hand, feel that the taxation of Internet services can be a legitimate source of tax revenue and that foreign companies that are providing services should be taxable in the countries where their services are being used. There was largely agreement that such taxes should not be imposed on people who are struggling to afford Internet access and that due consideration is needed regarding their impact on local content.
Panellists provided background on the introduction of such levies, noting that in Developing Countries and the Least Developed Countries, mobile network operations are sometimes the only kind of significant tax being collected. They highlighted that what is significant about these taxes is that they intersected with state or ruling party efforts at social and political control. As a result they often had contradictory outcomes, limiting the use of social networks which drive data demand and therefore not realising the rents they were intended to extract in order to meet debt repayments, while undermining national connectivity and financial inclusion efforts.
While governments need taxes to generate income, panellists all argued that current initiatives in Africa have not achieved their purpose and have, in many cases, led to unforeseen harms. Issues of taxation must be viewed in terms of the political economy of the countries, the challenges they face, the context of global platforms and the inability of governments to tax large platforms that are generating revenues in countries.
Panelists explained issues of taxation in terms of the political economy of the countries, the challenges they face, the context of global platforms and the inability of governments to tax large platforms that are generating revenues in countries. The impact of social networking on taxes is highly retrogressive, and what may appear a very small tax daily on networks and platforms is an enormous part of the income that people have. Some of the taxes saw a decline of 15% in data use and 30% in revenues, which raises the question of the purpose of the tax. Users are inevitably double-taxed; pushing more people offline hence reducing revenues for mobile operators, who collect taxes on behalf of users.
The difficulty of taxing companies was highlighted due to such companies not having a physical presence, hence the need for international cooperation. Example swere given, including the OECD and the G20-led initiative, BEPS) which is building an inclusive framework to collaborate on dealing with issues of tax avoidance for digital services without physical office presence in countries. From a policy point of view, developing countries should support such global initiatives which would ensure the revenues of the global platforms being derived from different jurisdictions could then be appropriately taxed, rather than taxing end users.
In an era where countries are talking about digital visions and transformation, conclusions and recommendations made centred engagement with governments, alternative taxation options, alternative solutions to providing Internet access like using spectrum allocations and a global fund to provision of access to WiFi.
Onsite participants: 35
Online participants: 8
Women online: 6
Women onsite: 20
Participants spent a significant amount of time reflecting on the effect that social media taxes and similar levies have for women and other potentially marginalised communities, including the elderly, poor, illiterate and those in rural areas. It was noted that such communities are likely to be even more susceptible to harms as a result of such tax proposals.