UTV | COLOMBO – Tech giants such as Amazon and Google could be handed hefty bills in future under a major shake-up of the UK tax system.
The new rules would aim to stop the world’s biggest technology firms raking in billions from sales but only handing tens of millions of pounds to the Treasury.
At the moment corporation tax is levied on profits. This means multinational companies can artificially reduce their UK bills using complicated company structures.
But changes being considered by the Government could see the firms taxed on their sales instead. Mel Stride, the Financial Secretary to the Treasury, yesterday said a tax on revenue – one of several options being looked at – was ‘the preferred route’.
He said current rules meant big tech companies are not being taxed fairly. ‘At the moment they are generating very significant value in the UK, typically through having a digital platform with lots of users,’ he told the BBC.
