Huw, you are an economic illiterate. Yes, rates and rent are a factor but the reason for that is partly the loss of sales because the very low tax paying internet giant are able to offer lower prices. The playing field is nowhere near level and it is not solely down to efficiency. Even your hero Johnson is calling for these tax avoiding internet companies to pay their fair shares of tax. Perhaps you hold share in Amazon and the like?
Frog in a tree
p.s. I see that our old friend, the frequently banned and dim witted Broadmoor 1, popped his head above the parapet to support you.
Exactly Froglet. People have short memories.
From just a year back:
UK chancellor Philip Hammond has used today’s budget to take aim at tech giants who he says aren’t paying their fair share of tax in the nation and is promising to introduce a digital sales levy in 2020 to rectify this.
However, Hammond said that, as the UK evolves for a digital age, “so too must our tax system to ensure it remains fair and robust” – with the key announcement being on digital tax for tech giants.
Nice profits you’ve got there tech sector
“There is one standout example of where the rules of the game must evolve now if they are to keep up with the emerging digital economy,” Hammond said: digital platforms delivering search engines, social media and online marketplaces.
Tax rules have “simply not kept pace with changing business models”, he said, adding that it as “clearly not sustainable or fair that digital platforms businesses can generate substantial value in the UK without paying tax here”.
As such, the UK will, in April 2020, introduce a digital services tax on search engines, social media platforms and online marketplaces.
Although the chancellor didn’t name Facebook, Google or Amazon, he did say he was “already looking forward to my call from the former leader of the Liberal Democrats” – Nick Clegg was recently appointed head of global affairs at the Zuckerborg.
The move comes as the OECD is trying to thrash out a global agreement on digital sales tax. Hammond – who hinted that the UK might go it alone earlier this month – said a global deal would be the ideal long-term solution, but that progress had been “painfully slow” and that “we cannot simply talk forever”. EU member states are also pressing for an interim deal as the OECD deliberates.
Hammond said the UK’s would be a “narrowly targeted tax” on UK-generated revenues and would not be aimed at start-ups. Rather, only companies that are profitable and generate at least £500m a year in the business lines in scope will have to pay. The first £25m of relevant UK revenues are also not taxable.
The government said it will not be a “generalised tax on online advertising or the collection of data” – and will put a levy of 2 per cent on the revenues that can be attributed to the business models linked to UK-based users.
For example, “if a social media platform generates revenues from targeting adverts at UK users, the government will apply a 2 per cent tax to those revenues”.
The exact scoping of the digital services tax – which is expected to raise £1.5bn over four years – and its safe harbor clause to protect those with very low profit margins will become more clear when the government launches its consultation in the coming weeks.
An update on the Tory Government’s Digital Services Tax… so they had their Consultation this year… so what happened next?
Well, the draft provisions are scheduled for inclusion in the next Finance Bill and are due to take effect from 1 April 2020…
However, they will never be implemented as described… reason?
The DST are now a bargaining chip for Johnson’s Tory Government in their future trade negotiations with the US.
Expect them to be trivialized or removed entirely… as the reality of negotiating a deal with the US behemoth from outside the world’s largest trading bloc sinks in for all.
I get the impression (maybe mistakenly though?) that Huw is one of those welcoming Brexit partly on ideological grounds. Though with his previously cited City background, he may also have been astute enough to have reduced investments in UK-centric stocks & increased stakes in dollar-earning global stocks. If so, his position becomes a bit more comprehensible, as opposed to all those hardcore Brexiteers living in straitened financial circumstances, habitually cursing their lot in life.
However, if his glee is just an anticipated schadenfreude, then indeed that seems rather sad. - Regards. Edit: Corrected typo in “straitened”.