U.K. Holds Firm on Digital Tax in Virus-Dominated Budget

March 11, 2020, 2:50 PM

The U.K. government is maintaining its commitment to introduce a digital services tax in three weeks.

Chancellor Rishi Sunak didn’t mention the DST in his budget speech on Wednesday, but it is included in the accompanying budget document.

The government announced tax deferral measures and freezes on business property taxes for retail, leisure, and tourism to reduce the economic impact of the coronavirus.

The budget also contained promises to:

  • Keep the corporate tax rate at 19%.
  • Introduce a tax of 200 pounds per metric ton (about $235/ton) on plastic packaging that doesn’t contain at least 30% recycled plastic content.
  • Reduce the lifetime limit of entrepreneurs’ relief—which allows business founders to pay 10% capital gains tax, less than the usual rate, when they sell their businesses.
  • Freeze fuel duty for the 10th consecutive year, but remove tax breaks on diesel for some industries.
  • Get rid of value-added tax on digital reading materials and female sanitary products.
  • Freeze all alcohol duties.
  • Make it easier to access tax-free child care.

To contact the reporters on this story: Hamza Ali in London at hali@bloombergtax.com and Joe Stanley-Smith in London at jstanleysmith@bloombergtax.com

To contact the editors responsible for this story: Meg Shreve at mshreve@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com

To read more articles log in. To learn more about a subscription click here.