UK finally takes on arrogant tech giants with digital services tax

Its about time too. This has been well overdue...How long can these tech gaints keep avoiding taxation in countries were they make billions of pounds.

The technology titans will not be trembling in fear. The sum of £400m that Philip Hammond says will be raised annually via his new digital services tax is a relative trifle. Even if the tax is concentrated among a small group of global companies, which seems to be the chancellor’s plan, the likes of Amazon, eBay, Facebook and Google can afford to pay. One suspects their enthusiasm for investing in the UK will not be affected one jot.

But the firms will be irritated by the UK’s go-it-alone approach. Hammond, assuming his plans are not watered down, will have demonstrated that countries do not have to wait for international agreement on how tax rules should be updated for the digital age. New taxes can be invented unilaterally, in this case a 2% charge on the UK revenues of “specific digital business models”, meaning search engines, social media platforms and online marketplaces.

Hammond, after muttering vaguely for ages, deserves credit for finally taking the plunge. The EU’s equivalent proposal for a 3% tax on revenues is currently bogged down in internal bickering and worries about a backlash from the US since most of the affected companies will be American. If the chancellor get his way, the UK’s digital services tax will be up and running from 2020.

Read on (source and credit)

https://www.theguardian.com/uk-news/2018/oct/29/uk-digital-services-tax-budget-facebook-google-amazon