logo-loader
viewAmazon.com, Inc.

Amazon and other tech giants under pressure as UK government quietly enacts digital services tax

The new law will levy a 2% tax on revenues earned by search engines, social media platforms and online marketplaces that have UK revenues of over £25mln

Amazon.com, Inc. - UK government to quietly enact digital services tax

One policy that was not trumpeted at the despatch box during Rishi Sunak’s budget is a UK digital services tax, which is due to be enacted on 1 April.

The new tax, originally announced in 2018, will tax revenues earned by “certain digital business” at 2% to ensure that the amount of tax paid in the UK reflects what the government says is “the value these businesses derive from their interactions with, and the contributions of, an active user base”.

The tax is designed to target search engines, social media platforms and online marketplaces that have UK revenues of over £25mln, a deliberate move to raise the bills of tech giants such as Amazon Inc (NASDAQ:AMZN), Google parent Alphabet Inc (NASDAQ:GOOG) and Facebook Inc (NASDAQ:FB).

Amazon earned around £10.9bn from the UK in its 2018 financial year, meaning if in force at the time the tax would have increased its British tax bill by £218mln.

The UK government’s decision to quietly enact the new levy may stem from the fact that it is about to enter complex post-Brexit trade negotiations with the US, which fiercely opposed the policy when it was first proposed.

Quick facts: Amazon.com, Inc.

Price: 2484.23 USD

NASDAQ:AMZN
Market: NASDAQ
Market Cap: $1.24 trillion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Australian Potash cashed up as it works to round off FEED programme at Lake...

Australian Potash Ltd's (ASX:APC) Matt Shackleton speaks to Proactive's Andrew Scott after raising close to $2.23mln via a rights offer which complements the $2mln placement completed in April this year. Following the release of the Definitive Feasibility Study (DFS) in August 2019, APC is...

10 hours, 35 minutes ago

2 min read