The week at a glance: 8 July – taxing times for tech
AGM season in London has brought some unwelcome news to British businesses this week, while politics has (again) dampened the spirits of global conglomerates. International relations have also created a difficult week for the currency markets. No matter – this weekend we’ve got a Federer-Nadal Wimbledon clash and the Cricket World Cup Final to brighten the mood.
The special relationship between the UK and US is frayed, to say the very least, following the leaked email furore which led to the resignation of Sir Kim Darroch, the UK ambassador to the US. The timing was therefore perhaps not ideal for the UK to plough ahead with its plans to clamp down on the tax paid by US tech giants. Donald Trump is not happy.
But with France taking the lead and pushing through its own new laws on the way the world’s biggest companies pay tax, the UK – which has a similarly frayed relationship with its closest neighbour – had little choice but to follow suit. Under the new laws, any digital company with revenue of more than €750m (£670m), of which at least €25m is generated in France, will pay a 3% tax on their sales. A similar proposal is planned in Britain.
At present, digital companies pay tax on their profits, which has allowed them to…
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