BritishAmerican Business Statement – The UK Government Should Pause Before Introducing a Digital Sales Tax

In response to the news that the UK will move ahead with a proposed Digital Services Tax, Duncan Edwards, CEO, BritishAmerican Business (BAB) said:

“The news last week that the UK Treasury is planning to follow France in introducing a revenue-based tax on digital companies is the wrong solution to a genuine problem.

“BritishAmerican Business understands the political challenge posed by large multinational technology companies seemingly generating huge revenues in the UK and paying very modest levels of corporation tax; international tax arbitrage is hardly new, yet little irritates consumer tax payers and those businesses  for whom tax payments are non-negotiable than the sense that others are not paying their fair share.

“We fully support the concept that individual countries should continue to be able to compete on tax rates, but this needs to go hand in hand with an international agreement on Base Erosion and Profit Shifting (BEPS).  International tax accounting is fiendishly complex, but with governments and businesses in cooperation, a multilateral solution should be achievable if all participants are willing.

In a white paper to be published later this summer we will set out our detailed views on this issue, and in particular on the UK proposal, but in the short term we urge the UK Government to pause before implementing what will inevitably be seen as a measure aimed at US tech businesses, many of which have chosen the UK as the main destination for their European investment.”