”Free access to a website” in return of ”personal data” considered as a ”Barter deal”

In recent years, there has been a growing concern about the use of personal data by tech companies, which has led to increased scrutiny by regulatory authorities. One such example is the recent argument made by the Italian Tax Authorities that allowing users free access to an app or platform in exchange for access to their data is a barter transaction subject to VAT.

The argument is that by providing access to the user’s personal data, they are essentially providing a service to the app or platform provider, and in exchange, they receive access to the app or platform. According to the Italian Tax Authorities, this constitutes a barter transaction that should be subject to Value Added Tax (VAT).

While this argument may seem logical at first glance, there are several challenges to implementing it in practice. For one, it is difficult to determine the value of personal data, which can vary widely depending on the type and quality of the data. Additionally, there are concerns about the potential for double taxation, as users may be required to pay VAT on the value of their data as well as on the services provided by the app or platform.

It remains to be seen whether other countries will adopt a similar approach to regulating the use of personal data by tech companies. However, the debate over how best to balance the interests of consumers and businesses in the digital age is likely to continue for some time.

 

Sources

• Italy assess Facebook for VAT on users’ data in return for ‘free’ portal access
• Italy is investigating parent company Facebook (META) for tax evasion
• Italy pursues Facebook-owner Meta for $925 million in VAT

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