Institutional Challenges of Cloud Taxation – An escalation proposal

This project analyzed and detailed the technology involved in the operations included in the concept of "cloud computing", identifying and distinguishing the hypotheses of IaaS, PaaS, and SaaS.  Once the operation was detailed from a factual point of view, with an exhaustive comprehension of the technology involved, the research faced the legal qualification of businesses resulting from contracting and providing such operations.  The challenges, at this point, involved both consumption taxation and income taxation.  Regarding consumption taxation, the project intended to answer, considering the Brazilian current rules, if contracting and providing cloud computing, either to store data or to work with a certain program, should be taxed by ICMS, by ISS, or none.  As for income taxation, the possibility of deducting expenses by users and the basis for calculating the income tax were investigated, in addition to carrying out a critical analysis of possible double taxation.  At this point, we reflected upon the influence that international treaties and the most recent OECD guidelines exert on the subject.