Big Tech Digital Tax Suspended After US Pressure


Tax: After 140 countries gathered at the Organization for Economic Co-operation and Development (OECD) earlier this month announced an agreement to implement a broad corporate tax reform, the UK decided on Thursday (21) to eliminate its tax on Digital Services, charged to the North American big techs, such as Google and Facebook.

However, according to a statement by the British Finance Minister, Rishi Sunak, the cancellation of the so-called “technology tax”, which seeks to avoid possible retaliatory actions by Washington, will only take place in 2023. For now, “we have reached an agreement on how we will do this the transition of our Digital Services Tax to the recently agreed global tax system”, guaranteed the executive.

Protecting technology tax until 2023

The transitional rules from national taxes on digital services (contested by the US) to the new global tax deal were fixed after a meeting that brought together representatives from the UK, Austria, France, Italy, Spain and the US. “This agreement means that our Digital Services Tax is protected as we move into 2023, so its revenue can continue to fund vital public services,” said Sunak.

The United Kingdom introduced the technology tax in April 2020, which is levied on the gross revenue of large digital companies in the country at a rate of 2%. According to the British minister, amounts collected from the Digital Services Tax after January 2022 will be deducted from future items intended to account for British corporate taxes, if they exceed the amount due under the new global rules.


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