UK may have to ‘press ahead on its own’ with plans to make tech giants pay their fair share
The UK will likely have to “press ahead on its own” with moves to compel technology companies to pay more tax in countries where value is created, The Brief reports.
Chancellor Philip Hammond proposed in his spring statement a measure to force companies including Facebook, Amazon and Google to pay more tax in jurisdictions where they generate income.
Lawyers have suggested the UK would seek international co-operation at the G20 next week in Buenos Aires.
Nick Gardner, a partner at Ashurst said: “Considerable momentum is building for a multilateral solution to the tax challenges of the digital economy.”
But he added: “Whether it can achieve its goal of obtaining an international consensus on an interim solution to taxing the revenues of digital businesses deriving significant value from UK user participation remains to be seen.
“If this solution is to be adopted soon, the UK still has a lot of work to do on the detail and may well have to press ahead on its own, like it did with the diverted profits tax, and hope other jurisdictions follow its lead.”
Other measures in Mr Hammond’s statement, including a consultation on entrepreneurs’ relief for capital gains tax, were welcomed,
Camilla Wallace, of Wedlake Bell, said the proposal would “help prevent the potential barrier to growth under the current rules, which might see affected, disincentivised individuals withdrawing their investment from the company in this situation”.