It's not that simple. Basically there are 2 different ways of storing digital audio data: lossy and lossless. Lossy means that in the process of storing the data 'things' get lost: some data is being removed because the idea is that they don't influence sound quality. Good examples are mp3 and ogg. The end result are files that are smaller than the original.
Lossless means that all the original digital data is being stored. This means that the original digital signal can be retrieved completely. The data is still compressed, but the files are in general bigger than with lossy. Good examples are wav and flac.
For most people a high quality mp3 or ogg (ogg is better than mp3, and a free format) is enough, but some people (me included) think that they can hear the difference between a lossy and lossless file.
On the pure technical side of things FLAC is then the best format. Biggest reason for that is that it's free: everyone can use the format and algorithms for free.
Next discussion of course should be about 44.1 audio against highres