U.K. Digital Tax Concerning to U.S. Tax Authorities
The tax aimed at big technology companies like Google, Amazon and Facebook
The United Kingdom announced earlier this week it will implement a new digital services tax aimed at big technology companies like Google, Amazon and Facebook. The U.K. tax will only be aimed at large tech firms that generate global revenue of at least 500 million pounds per year and won’t take effect until 2020, according to Philip Hammond, the U.K.’s Treasury head. Many of these companies are based in the U.S.
“It is only right that these global giants with profitable businesses in the U.K. pay their fair share towards supporting our public services,” Hammond said.
With the announcement this week, the U.K. got ahead of an international effort by developed nations to help standardize how to tax digital service platforms. The 36-member Organization for Economic Cooperation and Development (OECD) has been working toward an international agreement.
Treasury Secretary Steven Mnuchin and GOP congressional tax-writers said the U.K. should respect the ongoing global dialogue through the OECD and withdraw the proposed tax.
“Singling out a key global industry dominated by American companies for taxation that is inconsistent with international norms is a blatant revenue grab,” said House Ways and Means Committee Chairman Kevin Brady (R-TX). “If the United Kingdom or other countries proceed, that will prompt a review of our U.S. tax and regulatory approach to determine what actions are appropriate to ensure a level playing field in global markets.”
This article was provided to OSAE by the Power of A and ASAE's Inroads.