Key Facts

• Clauses 51 to 55 relate to the Digital Services Tax (DST).
• Groups must notify HMRC within 90 days of meeting DST threshold conditions.
• Clause 53 sets out the duty to notify HMRC when a group meets the DST thresholds.
• Schedule 7 provides further details about obligations and ensures figures and returns are complete and accurate.
• Tax should be seen as more than just punitive or revenue-raising.
• The concept of permanent residence was historically linked to trading rights within a nation.
• Modern discussions around tax involve capturing user-generated value in the digital economy.
• Clauses 60 to 63 deal with accounting periods and definitions for the digital services tax.
• Clause 60 sets the time period over which a group will account for revenues from relevant business activities for DST.
• Clause 61 addresses how revenues and expenditure are apportioned when there is a mismatch in accounting periods.
• Clause 64 sets out anti-avoidance provisions for DST.
• Clause 65 enables HMRC to collect unpaid DST liabilities from other members of a group.
• Schedule 8 provides further detail on how notices operate in clause 65.
• Clauses 66 and 67 set interest rates for early or late DST payments.
• Amendment 7 would change the reporting timeline for DST reviews to annually.
• New clause 11 requires the Chancellor to assess the net impact on tax revenues within six months after the Act passes.
• The review must include an assessment of revenue effects on Scottish Limited Partnerships.
• Clause 70 would require the Treasury to conduct a review of the digital services tax before the end of 2025.
• Amendment 7 proposes annual reports on the tax.
• The OBR in 2018 noted 'every stage' of the costing is uncertain, with uncertainty around data, behaviour, and modelling described as high or very high.
• The Government will review the Digital Services Tax (DST) if it remains on the statute book by 2025.
• There are no set guidelines defining 'temporary' for taxes in law.
• Country-by-country reporting is already in place privately, but public reporting requires international consensus.
• Amazon paid £220 million in direct taxation last year despite revenues exceeding £11 billion.
• The digital services tax aims to address online retail's impact on high streets and the shift in consumer habits towards home shopping.
• Scottish Limited Partnerships (SLPs) may be used for tax evasion, raising concerns about their role in avoiding DST.
• The DST is designed to raise £2 billion over five years.
• A legislative response to issues with Scottish limited partnerships is being framed by the Government.
• Amendment 7 and new clause 11 propose a report within six months of the Bill's passing, which would not contain useful information due to reporting deadlines.