Cable Forum - View Single Post

**Hugh** · 25-04-2019, 22:16

Quote:

Originally Posted by nomadking

These companies do pay corporation tax, just in the country they are based in and not the UK. They are acting as importers. Nothing new. Just as the main tax paid on a BMW car made in Germany, is paid in Germany. That is where the cost of building the car occurs. Any UK tax will only be paid on the "commission" part of any sale. Money earned from Intellectual Property(eg Franchise fees, copyright, etc) can be sent to any country in the world. Nothing new in that.

I wonder why the Conservatives brought a new law in, then?

https://www.theguardian.com/uk-news/...irms-uk-amazon

Quote:

Internet companies that legally avoid taxes by shifting profits overseas face being taxed on royalties on UK sales in a move dubbed the “Google tax”.

The measure, predicted to raise about £200m a year, forms part of the government’s latest package to tackle tax avoidance and evasion, which the chancellor predicted would raise a total of £4.8bn by 2022-23.

In his budget speech, Philip Hammond said: “Multinational digital businesses pay billions of pounds in royalties to jurisdictions where they are not taxed – and some of these royalties relate to UK sales.

“So, from April 2019, and in accordance with our international obligations, we will apply income tax to royalties relating to UK sales, when those royalties are paid to a low-tax jurisdiction.”

The move comes after international criticism of the taxes paid by huge digital businesses such as Google and Amazon, which route their profits through low-tax states.

A recent study found Amazon paid 11 times less corporation tax in the UK than British bookstores. Last year, Google agreed a deal with British tax authorities to pay £130m in back taxes and bear a greater tax burden in future.

The push to claw more taxes from digital businesses came as part of the chancellor’s yearly assault on tax evasion and avoidance.

He said the government had secured £160bn in additional tax revenue since 2010, and that his latest steps would raise £4.8bn. The figure includes £2.3bn of additional tax revenues brought in after committing £155m in new resources for HM Revenue & Customs.

HMRC is also benefiting from having the time it has to investigate all offshore tax non-compliance extended to 12 years, in the Treasury’s response to offshore exposés such as the Panama and Paradise Papers.