Hammond to push for global tax crackdown on tech giants
Chancellor Philip Hammond is calling for concerted international action by the world’s largest economies to ensure tech giants like Amazon and Google pay their “fair share” of tax.
Mr Hammond, who is attending a meeting of G20 finance ministers in Fukuoka, Japan, will warn that global tax rules are failing to keep up with the rapidly evolving digital economy.
In his Budget last year, the Chancellor announced a digital services tax on companies operating in the UK which generate worldwide revenues of at least £500 million a year.
The measure – which is expected to raise £400 million a year for the Exchequer when it comes into force next April – was intended to help redress the balance between the tech giants and hard-pressed bricks-and-mortar businesses when it came to tax.
However, Mr Hammond made clear at the time he would prefer to see a comprehensive global agreement to deal with the issue but complained that progress was proving “painfully slow”.
He will use the gathering in Fukuoka to make a renewed push for reform to the international corporate tax framework for digital businesses.
Ahead of the meeting, Mr Hammond said: “Britain’s future outside the EU depends on the strong partnerships we build with our friends and neighbours across the world.
“In Japan, I will further strengthen our successful economic relationship by showcasing how we’re embracing the new economy and champion our world-class expertise in tackling the challenges posed by the digital revolution.
“I will also meet with my G20 counterparts to reaffirm the need for global reform of the international corporate tax framework, to ensure it is fit for the future.”
The Chancellor will also push for the adoption of a set of shared global principles for “quality” infrastructure investment, to support efforts to close the “infrastructure financing gap” and drive sustainable growth.
He is due to meet senior Japanese business figures and bankers to discuss how the UK can maintain and strengthen its economic ties with Japan after Brexit.