Articles from Policy & Internet, Economics, Policy, Politics & Government

How Can Digitalisation Close the VAT Gap? Insights for Policymakers

by Hana Zídková 16/12/2024

By embracing digital transformation, policymakers can create more efficient, transparent, and fair tax systems that benefit both governments and taxpayers.

by Hana Zídková 16/12/2024

Close-up of a calculator and pen on a bar graph, representing finance and accounting.

The digitalisation of tax administration is a hot topic in the EU, with significant implications for VAT collection. Our recent study explores how the level of e-government, measured by the E-Government Development Index (EGDI), impacts VAT evasion, specifically the VAT gap, across EU Member States from 2003 to 2020. The findings reveal that higher levels of digitalisation in tax administration significantly reduce the VAT gap, highlighting the importance of digital transformation in public services. Why is this research important to policymakers? Here are three key elements that resonate with their needs: Enhanced Efficiency and Transparency: Digitalisation improves the efficiency of tax collection by reducing information asymmetry between taxpayers and tax authorities. This exchange leads to better compliance and less tax evasion. Policymakers can leverage these insights to advocate for more robust digital infrastructure in tax administration, ensuring that tax systems are transparent and efficient. Tailored Policy Measures: The study shows that the impact of digitalisation varies between original and new EU Member States. For instance, while digitalisation and corruption perception significantly affect the VAT gap in the original Member States, new Member States are more influenced by household consumption and standard VAT rates. This differentiation suggests that policymakers should tailor their digitalisation strategies to the specific needs and contexts of their countries Combatting Tax Evasion: The research underscores the role of digital tools in combatting VAT fraud, including carousel fraud. By implementing measures such as electronic invoicing and real-time transaction reporting, policymakers can significantly reduce opportunities for tax evasion. These tools not only enhance revenue collection but also build public trust in the tax system. The findings suggest that investing in digitalisation is not just a technological upgrade but a strategic move to enhance tax compliance and reduce evasion. Policymakers should focus on: Promoting digital literacy among taxpayers to ensure they can effectively use e-government services. Implementing comprehensive digital reporting systems to track transactions and detect fraud Customising digitalisation efforts…

Articles from Policy & Internet, Policy

Deep Fakes and the AI Act: an Important Signal or a Missed Opportunity?

by Mateusz Łabuz 16/12/2024

How are deepfakes regulated by the AI Act? What are the main shortcomings of the AI Act in regard to regulating deepfakes?

by Mateusz Łabuz 16/12/2024

A woman with digital code projections on her face, representing technology and future concepts.

The EU finally accepted the Artificial Intelligence Act, signaling its commitment to global AI governance. The regulation aims to establish a comprehensive regulatory framework for AI, setting new standards that might serve as a global benchmark in the future. Creating clear and precise rules that would enable the implementation of efficient safeguards for citizens against the manipulative potential of technology was not an easy task, and the EU failed to avoid visible shortcomings. In my study “Deep Fakes and the Artificial Intelligence Act – an Important Signal or a Missed Opportunity?” I raise legitimate questions about the effectiveness of the solutions proposed by the EU in regard to crafting protection against harmful applications of deepfakes. I concentrated on two primary research questions: How are deepfakes regulated by the AI Act? What are the main shortcomings of the AI Act in regard to regulating deepfakes? The EU has taken an important step towards regulating deepfakes, but the proposed solutions are, in my opinion, just a transitional phase. They require clarification, standardization, and, above all, appropriate enforcement. Regulations on deepfakes have not been a priority for the regulatory framework crafted by the EU, but experience with synthetic media teaches us that strict provisions are necessary. Deep fakes can be harmful when misused. We have already experienced that, namely, with attempts to manipulate electoral processes, discrediting politicians, and creating non-consensual pornographic content. These are only selected examples from the entire list of malicious applications. The basis for regulating deepfakes is the protection of citizens against disinformation and a strong focus on strictly political processes. In my opinion, this is a mistake. Statistics on video deep fakes show that non-consensual pornography is a key application, disproportionately targeting women. It contributes not only to the victimization of thousands of female individuals but also to misogyny and deepening gender-based discrimination. Failure to address this issue is, in my opinion, the biggest shortcoming of regulating deepfakes in…

Articles from Policy & Internet, Governance & Security, Policy, Politics & Government

Mediated Trust: From the open Internet to artificial intelligence

by Terry Flew 16/12/2024

Trust is a critical driver for AI adoption. If people do not trust AI, they will be reluctant to use it, writes Professor Terry Flew.

by Terry Flew 16/12/2024

Abstract illustration of AI with silhouette head full of eyes, symbolizing observation and technology.

There has been a resurgence of interest in recent years in setting policies for digital platforms and the challenges of platform power. It has been estimated that there are over 120 public inquiries taking place across different nation‐states, as well as by supranational entities such as the United Nations and the European Union. Similarly, the current surge in enquiries, reviews and policy statements concerning artificial intelligence (AI), such as the Biden Administration’s Executive Order on Safe Secure and Trustworthy Artificial Intelligence in the U.S., the U.K.’s AI Safety Summit and the EU AI Act, also speak to this desire to put regulatory frameworks in place to steer the future development of digital technologies. The push for greater nation‐state regulation of digital platforms has occurred in the context of the platformisation of the internet, and the concentration of control over key functions of the digital economy by a relatively small number of global technology corporations. This concentration of power and control is clearly apparent with artificial intelligence, where what the U.K. House of Commons Science, Innovation and Technology Committee referred to as the access to data challenge, with ‘the most powerful AI needs very large datasets, which are held by few organisations’, is paramount (House of Commons Science, Innovation and Technology Committee, 2023, p. 18). As a result, the extent to which the political of platform governance appears as a direct contest between corporate and governmental power is clearer than was the case in the early years of the open Internet. In my Policy & Internet paper, “Mediated Trust, the Internet and Artificial Intelligence: Ideas, interests, institutions and futures”, I argue that trust is a central part of communication, and communication is central to trust. Moreover, the nature of that connection has intensified in an age of universal and pervasive digital media networks. The push towards nation‐state regulation of digital platforms has come from the intersection of two trust vectors: the…

Articles from Policy & Internet, Governance & Security, Policy, Politics & Government

The Power of Digital Participation – How Online Tools Affect and Are Affected by Policy Conflicts

by Ilana Schröder 16/12/2024

Can e-participation improve policy processes, or do existing conflicts hinder its potential?

by Ilana Schröder 16/12/2024

Vibrant abstract pattern of illuminated red LED lights forming a dynamic design.

Involving local communities in political decisions is essential for transparent governance. This involvement is especially important in controversial issues, such as the siting of infrastructure, where a balance must be struck between the collective benefits of projects and the personal costs for nearby residents. However, despite efforts to engage communities, participation processes often lead to protests, loss of trust, and project blockades. This is where e-participation tools can play a significant role. As digital transformation reshapes governance, an increasing number of online platforms are being integrated into traditional participation processes. These platforms aim to make participation more inclusive and transparent by allowing individuals to engage regardless of their location or the time and by fostering a space for clear knowledge exchange. Nonetheless, how effective are communities in accessing these tools, particularly when conflicts are already intense? Can e-participation improve policy processes, or do existing conflicts hinder its potential? Our recent article published in Policy & Internet, titled “Digital Citizen Participation in Policy Conflict and Concord: Evaluation of a Web-Based Planning Tool for Railroad Infrastructure” by Ilana Schröder and Nils C. Bandelow, explores these questions. The research examines the performance of e-participation in both low- and high-conflict settings by focusing on a web-based tool that allows citizens to propose alternative railroad routes. Study participants were asked to use the online tool in a hypothetical scenario characterized as either conflictual or consensual. They then assessed the tool’s ability to promote inclusion, transparency, conflict resolution, and efficiency in the decision-making process. Here are the key findings: E-Participation Can Enhance Transparency and Mutual Understanding: Participants in both low- and high-conflict scenarios indicated that digital participation tools help enhance transparency in decision-making processes. When used effectively, these tools clarify planning criteria, include local knowledge, and improve mutual understanding among stakeholders. Therefore, e-participation tools can help reduce conflict escalation and facilitate creative solutions to complex issues. Digital Tools Aren’t a One-Size-Fits-All Solution: While digital platforms have…

Articles from Policy & Internet, Democracy, Governance & Security, Policy, Politics & Government

A plot on democracy: has the role of e-petitioning changed with the mainstreaming of conspiracy theories?

by Ben Lyall 16/12/2024

The emergence of conspiracy theories within petitions is paradoxical: why target these beliefs at the government using an official government channel?

by Ben Lyall 16/12/2024

Silhouette of a hand placing a vote into a ballot box, symbolizing democracy.

In an era of increased digitisation, e-petitions have become a popular form of political engagement. However, as the parameters of truth, democracy, false news, and conspiracy are challenged, so too is the original role of parliamentary petitioning. In our article, published in Policy & Internet, my co-author and I argue that the amplification of conspiracy theories shifts the goalposts for e-petitioning in terms of function. Specifically, unlike traditional petitions, they are not primarily aimed at producing policy changes. Instead, they function as social objects that achieve various community outcomes while adhering to petition rules. Signatures on these petitions, although lacking automatic results, signal popularity. Thus, the content of petitions can serve as a platform for airing shared grievances on topics such as immigration, economics, and health—and can even experiment with new forms of communication, such as emojis. As it is known, petitions alone rarely lead to policy changes, though they often reflect public sentiment and can significantly impact protest campaigns or social movements. E-petitions exist in various formats, with private platforms like Change.org being among the most well-known. In Australia, there are different types of e-petitioning, and it’s important to distinguish between them. The first type is private e-petitions, which serve as gathering spaces for individuals united by a common cause. The second type is parliamentary petitions, which can be initiated at either the state or federal level. Parliamentary petitioning is a process entrenched in parliamentary conventions. The petitions committee enforces rules that enable Australian residents and citizens to express concerns to Parliament and has some authority to compel action from government representatives. While rare, there are notable examples of e-petitions that have led to meaningful change. For instance, the Senate inquiry into media diversity, initiated by former Prime Minister Kevin Rudd in 2020, started with e-petitioning. Similarly, changes to teacher education requirements, which received numerous petitions in 2021, are currently being implemented. Our recent article for Policy & Internet…