The government has unveiled its plans for a tax on global tech firms, shortly after the French senate approved a similar measure despite US opposition.
The British government published draft legislation for the tax yesterday, with the new law set to come into force from April 2020. A 2% tax is planned on the revenues of search engines, social media platforms and online market places which derive value from UK users, according to draft legislation seen by Yahoo Finance UK.
Government minister Jesse Norman said that the tax would ensure “large multinational businesses pay their fair share towards the public services we rely on.” The French and British plans come after efforts to secure an international agreement on taxing global tech firms broke down. Such measures are proving controversial, with US president Donald Trump ordering an investigation into whether the French proposals unfairly target US companies.
The UK government has also tweaked its proposals following pressure from business, saying it will make various changes after consulting on the reforms. Company’s revenues will now be assessed on a group-wide basis, while financial and payment services will be exempt from the proposal.