Britain plans to introduce a tax to target multinationals such as Google and Amazon accused of using complex accounting schemes to cut their payments on earnings in the country.
Governments around the world are trying to overhaul international tax treaties to stop big corporations siphoning off profits into low-tax havens, but British finance minister George Osborne broke cover on Wednesday to announce his own changes next year.
Tax experts cautioned however that the move, in response to growing outrage over how little tax some big corporate pay, would be difficult to enforce unilaterally.
We will make sure that big multinational businesses pay their fair share, Osborne said in a half-yearly budget statement. The tax will be set at a rate of 25%.
Some of the largest companies in the world, including those in the tech sector, use elaborate structures to avoid paying taxes, he told parliament.
Companies including Google, coffee shop chain Starbucks and internet retailer Amazon have paid minimal corporate tax in Britain by shifting revenues to low-tax jurisdictions, for example by using a system of internal payments.
Deloitte's head of tax policy Bill Dodwell said he saw the tax as the first step towards wider international corporate tax changes that are being thrashed out by governments.
It will have to be done in a manner that is compatible with the way the international corporate rules are changing, and the UK is just going a bit early, he said.
Osborne said he would introduce the tax on profits generated by multinationals from economic activity here in the UK which they then artificially shift out of the country in April 2015. Details about how the tax will be levied will be published on Dec. 10.
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And what country is behind all those low tax CRIMINAL havens??Dec 04th, 2014 - 02:44 pm 0
What a stupid show. Who do they think they are fooling.
Sounds like a start. Australia is looking to follow suit and stop these companies that move their profits mainly to Luxembourg, Netherlands and Ireland.Dec 04th, 2014 - 07:05 pm 0
I'm always happy for any extra billions that come my way.
No.1Dec 04th, 2014 - 08:24 pm 0
What an ignorant nabo you are! Luxembourg and the Republic of Ireland are the offenders.