Document Type

Article

Publication Date

2-2026

Abstract

In an excellent Tax Notes article, Claudio Cipollini argues that the United States has adopted a paradoxical stance regarding digital services taxes. On one hand, the United States has repeatedly characterized DSTs as discriminatory trade barriers that unfairly target U.S. technology firms. On the other, it has systematically obstructed appointments to the Appellate Body of the WTO, leaving the dispute settlement mechanism effectively inoperative and ineffective. Cipollini presents this as a “missed WTO route,” suggesting that a functioning WTO system would primarily serve U.S. interests by disciplining European DSTs under the General Agreement on Trade in Services (GATS).

This article argues that the picture is somewhat more complex. The U.S. position is not a simple paradox. Rather, it is a rational, if defensive, response to asymmetric legal exposure under current WTO disciplines.

Comments

Reprinted with the permission of Tax Analysts.

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