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Digital giants face potential UK tax hikes

Online companies, expected to include the likes of Google, Facebook and big etailers, could be set for huge tax rises in the UK under potential new rules which include their number of users in the overall value of the company.

The so-called “eyeballs policy” would mean that digital companies would have to pay more tax in the countries where they are used by the most people.

Currently, businesses are taxed based on where they created the technology driving their business, or where the intellectual property rights for their systems are based.

The change in rules is now being considered by the G20, after it asked the Organisation for Economic Co-operation and Development to draw up recommendations for international tax rules. It is considering the rethink as part of a wider review of tax policies, according to The Financial Mail on Sunday.

However, any change is unlikely to come into effect until 2020.

 

 

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