One of the latest plans by the current UK government is to introduce something that has been nicknamed the ‘Google Tax’, which will attempt to stop large companies who operate in the UK from moving the profits they make abroad.
The government announcement today that this tax will go into effect in the UK from April 1st 2015.
“Let the message go out: this country’s tolerance for those who will not pay their fair share of taxes has come to an end,” The UK chancellor George Osborne told Parliament during today’s budget announcement.
When it does go into effect the Google Tax will mean that large companies who have been found to be moving their profits on UK earnings abroad will be charged 25 percent tax, instead of the usual 20 percent corporation tax that would normally be charged against profits.
This would mean that companies like Google, Apple, Amazon, Starbucks and many more will be most effected.
It will be interesting to see which companies are effected by this tax when it is enforced.
It is expected that the tax will only apply to organisations with annual revenues of more than £250, but is expected to only raise around an additional £360 million a year by 2017/2018, a tiny amount of the UK’s total budget, or the £3.1 billion that the government says that they will raise from anti-tax evasion.