Volume 47 (2019) / Issue 5

Lucas de Lima Carvalho, 'Spiritus Ex Machina: Addressing the Unique BEPS Issues of Autonomous Artificial Intelligence by Using ‘Personality’ and ‘Residence’' (2019) 47 Intertax, Issue 5, pp. 425–443


This article challenges an assertion made by the Organization for Economic Cooperation and Development (OECD) in the Final Report of Action 1 of the BEPS Action Plan, as well as in subsequent reports and policy notes. While the OECD claims in those documents that the digital economy only ‘exacerbates’ BEPS issues, we argue that the digital economy may also create unique BEPS issues related to Autonomous Artificial Intelligence (AAI) (specifically, the unique issues of ‘disappearing income’ and ‘powerlessness to tax’). AAI is defined as an Artificially Intelligent system that (1) is capable of performing tasks commonly associated with human intelligence and beyond, (2) is not directly or indirectly controlled by human beings, and (3) has full managerial power over its own actions and resources, which may be contained, but not controlled by human beings or by entities (legal or otherwise) representing the interests of human beings. The article provides policy recommendations to address the BEPS issues related to AAI, as well as comments on their impacts for tax administration, for enforceability and for the broader structure of domestic and international tax law.

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ISSN: 0165-2826
ID: TAXI2019044