For more than two decades, the WTO Moratorium on applying customs duties on electronic transmissions has supported a stable, predictable, and duty-free environment that has enabled digital trade to thrive. However, several WTO Members have recently questioned the opportunity costs of the Moratorium. 

OECD analysis shows that the potential foregone revenue implications of the Moratorium are small and for many countries are offset by rising VAT/GST revenue from “born digital” trade. The lapse of the Moratorium would come at the expense of wider gains in the economy, including for smaller and women-owned enterprises. 

There is a strong case for reducing barriers that affect digital trade. A 0.05-point reduction in the domestic Digital Services Trade Restrictiveness Index score, which indicates a strong regulatory reform, is associated with a 72.5% increase in overall exports. The impact is highest for digitally-deliverable services, but is also high in the food and agriculture and manufacturing sectors. The case is even stronger for emerging economies where the benefits of reform deliver greater export gains.

In addition, Regional Trade Agreements with digital trade chapters have the potential to double the impact of trade agreements, although this will depend on the depth of the provisions signed.