Yesterday's budget did indeed contain measures designed to increase the tax bills of the transatlantic tech giants, with the chancellor outlining a plan to make as much as £400m a year from the introduction of the UK Digital Services Tax in 2020.
There are plenty of caveats attached to its existence. The plan is to take two percent of revenues from the biggest companies that operate online, with any potential tax-skim designed only to hit companies that (a) turn a profit and (b) take in more than £500m each year in global revenues. This will stop it from attacking the earning power of smaller scale digital startups, plus it only covers businesses classified as search engines, social media platforms and online marketplaces.
The potential new tax is not guaranteed to come in to force at all, though, as it's what you might call a financial backstop designed to fill the gap until a more coordinated global effort on taxing digital high-earners is ready; if alternative negotiations on digital service taxes headed by the OECD can come up with a better solution, the UK might sign up to that instead.
Hammond said during the budget: "A new global agreement is the best long-term solution. But progress is painfully slow. We cannot simply talk forever. So we will now introduce a UK digital services tax. It is only right that these global giants, with profitable businesses in the UK, pay their fair share towards supporting our public services." [Treasury]