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.