Abstract

This study analyzes the Taxation of the Digital Economy (TED), identifies the main challenges faced by the Mozambican Tax System (SFM) (2023–2025), examines the relevance of the connecting factors to TED, and proposes improvements to the SFM to ensure tax fairness and prevent competitive asymmetries. A mixed-methods approach was used–qualitative, descriptive, and exploratory–through semi-structured interviews with two Mozambican Tax Authority (AT) officers. Content analysis was applied; for the quantitative component, an online questionnaire was administered to 163 individuals, and statistical analyses were used (descriptive statistics, Chi-square Test, Student’s T-test, ANOVA, principal component analysis, cluster analysis, and discriminant analysis). The results revealed limited tax collection capacity due to gaps in legislation, a lack of connection criteria, insufficient technological integration, and difficulties in tracking cross-border digital transactions, despite the growth of the digital economy (EcD) in Mozambique. It is concluded that reforms are needed in the SFM for cross-border digital taxation, to strengthen technology in tax administration, and to implement international cooperation strategies. The study contributes to the literature on cross-border digital taxation in African contexts and offers practical implications for the formulation of tax policies in Mozambique.