Originally written by Timothy Adler on Small Business
Amazon has said that it could pass the cost of the government’s planned 2 per cent digital tax onto small businesses that sell through it.
The 11 March Budget is expected to introduce the “digital services tax”, a 2 per cent levy on UK revenues of technology businesses, which pay little or no domestic corporation because their European headquarters are based in tax havens such as Ireland or Luxembourg.
The government expects the new tax to bring in almost £500m a year.
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However, Amazon UK country manager Doug Gurr, told the Financial Times that the tax could raise costs for small businesses which use its sales and delivery platform.
When France introduced a 3 per cent levy in July 2019, Amazon hiked its charges for small business sellers by the same amount.
Gurr said: “If you are not careful in the design, these taxes can actually hit all of the small businesses that use our services. The majority of sales on our marketplace are independent businesses. If that tax is passed on to them, that is quite a significant hit.”
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