The UK have announced the introduction of ‘Amazon tax’ on large online platforms such as Amazon, Google and Apple despite the US’s irritation over its “unfair” targeting of the US companies.
The UK is the second country to pioneer digital services tax after France imposed a similar directive last week. What seems like a bold move by the UK, following US threats to impose trade sanctions on France, the speculations that the UK might face the same fate are raising.
Concerns are also heightened that the introduction of the legislation will make the UK a less attractive cross-border market.
Similar to the French digital levy, the UK’s 2% tax on revenues of social media, search engines and online marketplaces aims to raise £440 million by 2023 to “support public services.”
It will apply from the 1st of April 2020 to online businesses with an excess of revenues of £500m globally and £25m in the UK. There is an allowance of £25m, which means a group’s first £25m of revenues derived from UK users will not be subject to digital services tax
“The UK has always sought to lead in finding an international solution to taxing the digital economy. This targeted and proportionate digital services tax is designed to keep our tax system in this area both fair and competitive, pending a longer-term international settlement.”
– Jesse Norman, junior minister, Treasury.
2 Responses
£440?
It’s wonderfully irrelevant.
So daft that we should argue for the same draughtspersons to rewrite income tax legislation.
The only risk would come from El Corbynio’s election.