Rishi Sunak plans to axe the £500million-a-year ‘Facebook tax’ on US tech giants after deciding that angering Donald Trump is ‘more trouble than it’s worth’
Chancellor Rishi Sunak is set to ditch the ‘Facebook tax’ on big tech companiesHe reportedly decided The Digital Services Tax is ‘more trouble than it is worth’ The tax is also said to be an impediment to Liz Truss’s trade talks with the USUS Government say the tax on international companies unfairly targets them
Chancellor Rishi Sunak is planning to ditch the ‘Facebook tax’ on big tech companies after concluding that it is ‘more trouble than it is worth’, The Mail on Sunday understands.
The Digital Services Tax, which came into effect last April, is likely to be axed after Mr Sunak concluded that the £500million a year it is expected to raise is a pinprick compared with the hundreds of billions of pounds dent to the nation’s finances caused by the coronavirus epidemic.
The tax is also an impediment to the trade talks with Washington, conducted by International Trade Secretary Liz Truss, with the US government insisting it unfairly targets American tech firms.
Chancellor Rishi Sunak is planning to ditch the ‘Facebook tax’ on major tech companies after concluding that it is ‘more trouble than it is worth’
Donald Trump insisted the tax, which was designed by Philip Hammond to ensure international tech companies pay some tax on revenues made in Britain, unfairly targets US tech firms
One source told The Mail on Sunday: ‘At just half a billion quid, Rishi has concluded it is just more trouble than it is worth, given the anger of Trump and the Washington establishment.’
Previous Chancellor Philip Hammond designed the tax, which is levied at a rate of two per cent of sales, to ensure international tech companies pay at least some tax on revenues, if not the profits, which they make in Britain.
The limitations on the tax put in place by the Treasury ensure that almost all of the revenues will come from US tech companies.