Digital technologies are changing societies and economies and bringing new challenges and problems in taxation. When supplying digital (electronic) services, it is often difficult to determine the location of buyers, which is important for taxation. Cross-border digital companies have new business models often without a physical presence in the countries and at the same time offer services to customers that contribute to their value creation for free, and countries cannot tax it under current rules. Therefore, the European Union has proposed new determinants of taxation, i.e. the extension of the definition of a permanent establishment with the concept of a significant digital presence and a tax on certain digital services, which was ultimately not accepted. Some countries have introduced their own tax on digital services, which means that there is no consensus on the taxation of digital economy at the international level. The objectives of the work and research are, using the methods of analysis, description, comparison and compilation, to show the development of digital technologies on which the digital economy is based, i.e. digital services and their impact; to show the tax treatment of services, especially digital services in the European Union, therefore also in Croatia; to analyze the legislative solution for the taxation of digital services in the United Kingdom and France and to make proposals for the introduction of a digital services tax in Croatia. The expected contribution of the paper is an overview of the tax treatment of digital services through value added tax and corporate income tax in the European Union and Croatia, analysis of digital services taxation in the United Kingdom and France and finally certain proposals related to the introduction of digital services tax in Croatia.