Chancellor Philip Hammond is planning to introduce a ‘digital services tax’ from April 2020. He noted that the tax will target “established tech giants” rather than startups.
The BBC described the digital services tax as “a levy against social media platforms, internet marketplaces and search engines” and explained that the chancellor is proposing a 2% tax rate against the sales that large digital companies make in the UK.
Amazon, Google and Facebook were not named by Hammond as targets, but it’s expected the US tech juggernauts will experience the taxation, as the chancellor said companies generating “at least £500m a year in global revenue” would be applicable.
Despite Mr Hammond emphasising that startups would be protected from the levy, Julian David, chief executive of industry body TechUK, told the BBC that there is a risk that smaller companies could be affected, due to the £500m threshold being “low”.
Find out more about the digital services tax on bbcnews.co.uk
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