UK pushing for global digital tax despite US
reservations
The UK is pushing for the introduction of a global
digital tax despite the departure of the United States from international negotiations.
The Treasury confirmed that the UK will push for a
solution to taxing international digital companies despite US Treasury
Secretary Steven Mnuchin recently pulling out of talks with Europe on the
matter.
The Organisation for Economic Co-operation and Development
(OECD) has so far failed to find a solution that suits the interests of all
countries concerned.
A spokesperson for the Treasury said: ‘We have always been
clear that our preference is for a global solution to the tax challenges posed
by digitalisation, and we’ll continue to work with our international partners
to achieve that objective.’
The UK and France have forged a path forward in regard
to taxing digital companies: both already have their own Digital Services Taxes
(DSTs). The UK’s DST took effect from 1 April
2020, and applies a 2% tax to the revenues of certain digital businesses. A
double threshold exists, meaning that businesses have to generate revenues from
in-scope business models of at least £500 million globally to become taxable
under the DST.