HM Treasury have published a response to ‘Digital services tax: consultation’, regarding the design and implementation of the proposed new tax to be introduced from April 2020.

The proposal is that the Digital service tax (“DST”) will be 2% tax on UK revenues of large digital businesses which derive significant value from user participation. It will apply:

Most of the 79 respondents acknowledged the challenges facing the international tax system, with broad support for the ongoing OECD process to seek a consensus-based international solution to the tax challenges arising from digitalisation by 2020. There were concerns about the UK adopting a unilateral approach and a revenue based tax, with calls for it to be delayed or temporary in nature. There were also concerns about the tax being passed onto consumers

Following the consultation  the government has confirmed that it does not intend to make any changes to the proposals included the original consultation document and has concluded the position in respect of certain specific areas:

Draft legislation was published alongside the consultation response.

Links to our guides:

Digital Services Tax (DST)

External links:

Digital services tax: response to the consultation

Draft legislation