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British treasury chief proposes 'digital services tax' on tech giants

Britain's chancellor of the exchequer, Phillip Hammond, waves Oct. 1 in Birmingham. (NEIL HALL / EPA-EFE / SHUTTER STOCK) (Neil…


Britain’s chancellor of the exchequer, Phillip Hammond, waves Oct. 1

in Birmingham. (NEIL HALL / EPA-EFE / SHUTTER STOCK) (Neil Hall / EPA-EFE / REX / Shutterstock)

The head of Britain’s treasury has proposed a new tax targeting tech giants such as Google, Facebook and Amazon.com, in what He was described as a necessary evolution of the corporate tax system in the digital age.

“The rules have simply been kept pace with changing business models,” said Philip Hammond, Chancellor of the Exchequer, in a budget address to Parliament on Monday . “Og det er klart ikke bæredygtigt eller rimeligt at digitale platformsvirksomheder kan generere væsentlig værdi i U.K.

Hammond sa, at hans forslag til “digital services tax” ville gælde for “etablerede tech giants” snarere end start-up-virksomheder og ville tage form som en smal omsætning på Storbritannien.

Hammond said that Britain has been at the forefront of corporate tax reform and acknowledged that, for technology platform business models.

The announced tax initiative comes as financial officials in the European Union. a “new global agreement” remains the best solution in the long run. He said the progress on updating the tax law as “painfully slow.” “We can not simply talk forever,” he said.

The tax would take effect starting in April 2020, Hammond said, and is expected to generate over 400 million pounds per year, or about $ 512 million. The British Government would consider withdrawing the tax if officials representing the Group of 20 and the Organization for Economic Cooperation and Development came to a suitable global agreement, he said.

Hammond noted that the digital services tax will be crafted to not fall on consumers, the way an online sales tax would be. Only profitable companies that pull in at least 500 million pounds in global revenue on their business lines would be mandated to pay, he said.

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