Technology giants will be forced to pay tax on the sales they generate in the UK, under new plans announced in the Budget. Chancellor Philip Hammond plans to introduce a digital services tax from April 2020 following a consultation.
He said “established tech giants” will be targeted rather than start-ups. Companies such as Amazon and Facebook have been criticised for the small amount of tax they pay in the UK.
Both the 36-member OECD and the European Commission have been trying to reach a consensus on imposing a digital tax on social media platforms, internet marketplaces and search engines.
However, Mr Hammond said that progress was “painfully slow”. He said: “It is clearly not sustainable or fair that digital platform businesses can generate substantial value in the UK without paying tax here.”