back to article Budget 2018: UK goes it alone on digital sales tax for tech giants

UK chancellor Philip Hammond has used today’s budget to take aim at tech giants who he says aren't paying their fair share of tax in the nation and is promising to introduce a digital sales levy in 2020 to rectify this. The 2018 budget, delivered on a Monday for the first time since 1962, claimed that austerity is “coming to …

  1. AndrueC Silver badge
    Meh

    ..and the corporations will pass the cost of that tax straight on to us as higher prices. Thanks Phil.

    1. Brewster's Angle Grinder Silver badge

      You're paying for Facebook? Or Twitter? Or Google search?

      1. Chronos Silver badge

        Indirectly, yes. We buy something, a portion of that something's cost is advertising. Advertising costs go up, so do the prices of $THINGs.

        1. Brewster's Angle Grinder Silver badge

          Do manufacturers really pass on increased advertising costs like they were a prise rise in a component or do they set a fixed budget (based on the market situation and available cash) and then spend it as best they can?

          1. Will Godfrey Silver badge
            Unhappy

            It's bread and circuses, and designed the convince the less aware that we are getting something for nothing.

          2. Anonymous Coward
            Anonymous Coward

            >Do manufacturers really pass on increased advertising costs

            Manufacturers will always charge the maximum amount customers are willing to pay, deductibles like advertising are absorbed elsewhere.

            1. AMBxx Silver badge
              Facepalm

              Sounds like all the people who have been complaining about multi-nationals not paying their fair share of tax are now complaining about the cost being passed to them personally.

              1. Anonymous Coward
                Anonymous Coward

                Ignorance of incidence of taxation 101 now at 100% ....

              2. aks Bronze badge

                You don't think the companys will trim their profit margin, do you?

                Everybody is paying VAT on purchases, so it's not as if the purchasers are buying stuff tax free.

                The UK won't get this tax to fly until the OECD creates a level playing field. Now that the USA has reduced its headline corporation tax, there's a chance for this to happen.

                Shareholders will be the ones paying any new tax, significant numbers of which are pension funds.

                There is no money tree. Ultimately, it's us who pay for all government spending.

                1. Anonymous Coward
                  Anonymous Coward

                  That's not how money works at all. There is a money tree its called fiat money which is created as debt (98% of all new money is created as loans). There is no gold standard, no fixed amount of money and no way of paying the debt back under the present system. Government spending is not determined by tax revenue and has not been for many, many years. The prime example is the US - where huge debt can be run up with zero prospect of it being paid back - but the dollar is still required for paying for oil which stops the value of the dollar falling too far. In fact if you believe governments should not 'borrow money' and individuals should not spend more than they earn, then welcome to the collapse of the financial system. No more debt spending means no more new money into the economy and the debts cannot be repaid or even the interest on the debt. Its an insane system that is one day bound to collapse, but that's what we've got.

          3. Anonymous Coward
            Anonymous Coward

            @Brewster...

            Not sure why you got a downvote as that is exactly the way it works. The marketing department of a company gets its yearly budget and spends it. If the advertising costs go up they change the marketing channel or buy less advertising.

            Most of Google adwords is based upon auction style bidding anyway so costs are based around what everyone else wants to pay rather than set by Google directly.

          4. Keith 20

            Of course they pass the costs on. A fixed marketing budget doesn't come from the advert fairies...

          5. katrinab Silver badge

            "Do manufacturers really pass on increased advertising costs like they were a prise rise in a component or do they set a fixed budget (based on the market situation and available cash) and then spend it as best they can?"

            It's complicated.

            They will spend eg £100 on advertising if the profits they make from additional sales resulting from the adverts are more than £100. The way that advertising slots are sold at real-time bidding auctions means that the after-tax price would go down. That may reduce supply of advertising slots, and push the price back up a bit, by pushing the most marginal advertisers out of the market.

            1. Anonymous Coward
              Anonymous Coward

              "They will spend eg £100 on advertising if the profits they make from additional sales resulting from the adverts are more than £100"

              ROFL ... if only.

              The marketing department will get a fixed budget with potential additional for special projects which they will spend and try to evaluate the coverage and reach by a number of methods that rarely hold up to scrutiny. They will then say they don't have enough insight, or add words like brand awareness or talk about the long tail - all very intangible, but enough to confuse the CEO to maintain their budget or increase it the next year.

              True example I have seen first hand (has been distorted for confidentiality).

              Company spends £a on a marketing idea in their non-usual channel at an audience in a country that they don't usually target. The return is £a x 10. "wow, we must do more of this", "lets put more money into this next year", "the marketing department are amazing". Then some lowly ranked person asks the question what was the spend from that country the past three years without targeting them and without the new channel. Just happens to have been even more revenue previously, just hadn't been directly noticed!

        2. Smooth Newt Silver badge
          Meh

          Does advertising increase consumer prices?

          Indirectly, yes. We buy something, a portion of that something's cost is advertising. Advertising costs go up, so do the prices of $THINGs.

          The cost of advertising your product on the Internet goes up - do you pass that onto the consumer? I don't think so - unlike manufacturing and distribution costs, which have to be absorbed somewhere, advertising is something that you choose to spend based on a balancing act of depressing sales because your product is more expensive and increasing sales because more people think buying it makes them look smarter or sexier or whatever.

          I suspect as advertising costs go up, you look for cost savings in the advertising - for example doing less of it, perhaps more efficient targetting.

      2. Anonymous Coward
        Anonymous Coward

        I'm not paying for google search directly, but I'm ABSOLUTELY sure they'll find a way to recover that cost, and it'll be recover PLUS, as usual. Not that I think they should get away with what they have until now, those fuckers, it's just that they're like slime, you squeeze here, it starts poking out through other gaps...

      3. I&I

        ...or any products etc. advertised by them?

        (“food-chain”)

    2. Yet Another Anonymous coward Silver badge

      >..and the corporations will pass the cost of that tax straight on to us as higher prices. Thanks Phil.

      No they won't. British Widgets Ltd will run the job on a cheaper foreign Amazon AWS zone (no GDPR for us now we are free of the ECJ jackboot), Amazon will book the AWS revenue abroad.

      Or are we going to demand that British companies only use British suppliers for their internet stuff ?

      1. DavCrav Silver badge

        "No they won't. British Widgets Ltd will run the job on a cheaper foreign Amazon AWS zone (no GDPR for us now we are free of the ECJ jackboot), Amazon will book the AWS revenue abroad."

        Well, given the wording of the article, if they book that revenue abroad and don't declare it to the Exchequer, that would be tax fraud. If they do declare it, the 2% (for example) counts as that. And since British Widgets Ltd will declare it in their accounts, it would be a dangerous game to play.

        1. Yet Another Anonymous coward Silver badge

          > if they book that revenue abroad and don't declare it to the Exchequer, that would be tax fraud

          Why if they are a foreign company?

          I buy email services from a US company, they book that income in the USA (or probably in Grand Cayman) I have that in my accounts as a payment to the US company. Where does the Inland Revenue get any of this ? Is the UK planing to tax any foreign company on sales from UK customers?

          All Amazon have to do is close its AWS business in the UK, and have UK customers use USA hosted AWS zones and pay in $. It can still keep its UK shopping site - that makes no profit.

          1. Jellied Eel Silver badge

            It can still keep its UK shopping site - that makes no profit.

            Only thanks to slick financial engineering. So it transacts between a UK customer and a UK supplier, or supplies out of it's UK warehouse. Practically, that should be a UK sale. Or it becomes an Irish sale with costs lumped on from other bits of Amazon to make that sale (or commission) unprofitable. So the budget proposal is a 'simple' sales tax to try and stop that kind of pish take. Which may or may not work depending on lawyers and accountants. Same kind of deal applies with Google, ie they've sold $X in advertising to UK eyeballs, give HMG 2% TYVM.

            1. Anonymous Coward
              Anonymous Coward

              Except, with tech being basically free to cookie-cut your way into as much replication as you can be bothered, they will sell, for example, $X worth of "advertising" to Wakanda, and give you the rest of the world for free. That way, the allocated UK "expense" was free, and therefore untaxable. Good luck HMRC getting a piece of the pie from Wakanda, or any other tax haven you care to mention...

          2. DavCrav Silver badge

            "Is the UK planing to tax any foreign company on sales from UK customers?"

            Quite possibly, yes. Ones that have sales in the tens of millions to consumers.

            "It can still keep its UK shopping site - that makes no profit."

            Revenue tax, not profit tax.

    3. Craig 2

      "..and the corporations will pass the cost of that tax straight on to us as higher prices. Thanks Phil."

      Ignoring the fact (already pointed out) that we don't pay for services from most of the targeted corporations, it will also hopefully start towards leveling the playing field with online mega-retailers and small businesses.

      1. Grant2407

        I’m puzzled why people think we shouldn’t tax the digital multi nationals more as it may increase consumer purchase costs. By that logic if we removed all corporation tax then we’d all be happy as everything would be cheap - when the reality is that shareholders would be taking home larger dividends and we’d have to incur higher income tax or VAT to make up the shortfall.

    4. LucreLout Silver badge

      ..and the corporations will pass the cost of that tax straight on to us as higher prices.

      Sorry, but there will be no cost to the corporations, not many anyway. Or better put, not the intended targets.

      Some facts:

      1. DST is only intended to run until OECD/G20 tax comes in.

      2. DST is in consultation with a 2020 implementation date.

      3. OECD is in consultation also with a 2020 implementation date.

      4. DST has a "safe harbour" exemption for those of a loss making persuasion.

      5. There is no requirement to have a legal entity registered in the UK in order to have a web site accessible from the UK.

      6. DST is intended to raise £400M

      7. We have no means of determining how much Google makes from UK search Vs its Android division or any of the other letters in the Alphabet Soup.

      Thus, we can determine the following opinions:

      DST will cost the Treasury a lot of money (fact 1) and in all likelihood raise nothing because we'll implement OECD by the time DST is ready (facts 2 & 3).

      Amazon won't pay a penny in DST because it makes a loss (facts 4 & 7). Google can probably restructure to achieve the same thing (facts 5 & 7). Apple might take a hit, but barely; we can't actually force companies to register for some type of self assesment by which we could calculate their DST if they don't require a physical presence here.

      They're avoiding what is frankly a trivial tax split between even just the 4 main players (fact 6).

      It makes for a good announcement but will in all likelihood either only raise revenue from unintended targets (How many web sites have a search feature that isn't google? Digital publishing step right up), or would in any case raise less than MPs spend on their pensions.

  2. DougS Silver badge

    Commenorating Brexit?

    Shouldn't they wait until it has actually been in effect a couple years to see whether it is the win its backers claimed, or the disaster those who voted against it said it will be?

    I mean, I'm pretty sure the US never considered a coin commemorating the Vietnam war...

    1. Anonymous Coward
      Anonymous Coward

      Re: Commenorating Brexit?[sic]

      It could be seen as marking the occasion rather than supporting it. There was a 1066 Battle of Hastings 50p coin also, hardly Britain's finest hour!

      1. I ain't Spartacus Gold badge
        Happy

        Re: Commenorating Brexit?[sic]

        What, they minted a 50p coin in 1066? That must have been worth a fortune!

        Oh I see - carry on...

      2. katrinab Silver badge
        Facepalm

        Re: Commenorating Brexit?[sic]

        I don't think we had a 50p coin back then, or a 10 shilling coin for that matter.

        1d was equivalent in value to about £1 now, and we had 1d, 1/2d and 1/4d coins.

        1. Teiwaz Silver badge

          Re: Commenorating Brexit?[sic]

          I don't think we had a 50p coin back then, or a 10 shilling coin for that matter.

          1d was equivalent in value to about £1 now, and we had 1d, 1/2d and 1/4d coins.

          According to Blackadder, in 1066 the egg had yet to supercede the worm as Britains lowest form of currency.

      3. Anonymous Coward
        Anonymous Coward

        Re: Commenorating Brexit?[sic]

        I kind of want to see an Agincourt minted coin, now.

    2. Anonymous Coward
      Anonymous Coward

      Re: Commenorating Brexit?

      >Shouldn't they wait until it has actually been in effect a couple years to see whether it is the win its backers claimed, or the disaster those who voted against it said it will be?

      I strongly believe that all government policies should have associated, strictly defined and independently measured KPIs. Any policy that doesn't meet 95% compliance after a pre-defined period of time automatically gets reversed and the Minister responsible loses their job.

    3. Spazturtle Silver badge

      Re: Commenorating Brexit?

      They made a coin when we joined the EU without waiting to see how that turned out, so why should this be any different?

  3. Brewster's Angle Grinder Silver badge

    The celebratory 50p should show two fingers being waved at the viewer and read, "Fuck you all."

  4. smudge Silver badge
    WTF?

    Brexit coin

    Surely a Brexit coin can only be a sovereign? That's what it was all about, they kept telling us.

    1. Chronos Silver badge
      Coat

      Re: Brexit coin

      Okay, don't groat over it...

      1. J.G.Harston Silver badge

        Re: Brexit coin

        Shouldn't it be a 52p coin?

        1. Androgynous Cupboard Silver badge

          Re: Brexit coin

          Try the new Brexit coin! Accepted in 52% of shops everywhere! OK, not in London, but everywhere else.

        2. MyffyW Silver badge

          Re: Brexit coin

          > Shouldn't it be a 52p coin?

          Err, more like a 45p coin given the deterioration in exchange rates since that vote.

          1. katrinab Silver badge

            Re: Brexit coin

            Or maybe a Zimbabwean style £1,000,000,000,000,000,000 coin which is worth basically nothing.

  5. Anonymous Coward
    Thumb Up

    They should cut out the middlemen

    And give the £350m per week we no longer have to pay the EU to IT contractors.

    1. Pascal Monett Silver badge
      Coat

      Re: They should cut out the middlemen

      Haven't they all left already ?

      1. codejunky Silver badge

        Re: They should cut out the middlemen

        @ Pascal Monett

        "Haven't they all left already ?"

        Doubt it. For all the EU lovers they seem to still be here screeching. Except the doctors who decided that brexit means they must go to that other EU member New Zealand (if I remember that right).

        I am wondering if the 50p will be an attempt to remind some people what the result was.

        1. Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble? Silver badge

          Re: They should cut out the middlemen

          @codejunky

          Doubt it. For all the EU lovers they seem to still be here screeching.

          And yet ironically a glut of ministers and personalities responsible for the vote leave campaign are either buying of have bought residences abroad recently. Funny that.

          1. codejunky Silver badge

            Re: They should cut out the middlemen

            @ Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble?

            "And yet ironically a glut of ministers and personalities responsible for the vote leave campaign are either buying of have bought residences abroad recently. Funny that."

            So not racists and xenophobes but instead outward looking. Good.

            1. Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble? Silver badge

              Re: They should cut out the middlemen

              @codejunky

              So not racists and xenophobes but instead outward looking. Good.

              Absolutely, and I have never labelled any of them as such. Rat-bastards leaving a sinking ship after they personally gnawed a hole right through the hull for their own personal amusement, yes absolutely, but not xenophobic.

              1. codejunky Silver badge

                Re: They should cut out the middlemen

                @ Rameses Niblick the Third Kerplunk Kerplunk Whoops Where's My Thribble?

                "Absolutely, and I have never labelled any of them as such."

                I said it for the benefit of the remainers who like to make such claims.

                "Rat-bastards leaving a sinking ship"

                That is one way to describe leaving the EU but then the rat cannot save the sinking ship and making an exit is a good idea. As for them buying foreign property, so what? We have a world of people investing in property here. Not a bad thing.

        2. Paul Shirley

          Re: They should cut out the middlemen

          "I am wondering if the 50p will be an attempt to remind some people what the result was."

          Why? Have you forgotten the UK voted to split England&Wales from NI&Scotland so soon?

          1. codejunky Silver badge

            Re: They should cut out the middlemen

            @ Paul Shirley

            "Why? Have you forgotten the UK voted to split England&Wales from NI&Scotland so soon?"

            What on earth are you talking about? Scotland had a vote and decided to remain (with support for leaving falling hard). Attempts to resuscitate such desires fell hard when the facts became obvious that if Scotland leaves the UK in hope of joining the EU they will be nothing but alone and disappointed (they dont meet the criteria).

            As for NI they are still part of the UK. That is why the EU is trying to annex it.

        3. Anonymous Coward
          Anonymous Coward

          Re: They should cut out the middlemen

          Believe me they are leaving if not already. Myself and an absolute hoard have made the break to places like Holland, Canada, Aus and Dubai. Britain is haemorrhaging talent right now, and IR35 is one of the final nails. We provide a 'scalable' workforce; come in, do a complex job do get a company operation or service rebuilt quickly and then go. Thing is, we don't really show up on 'stats', so its a 'silent' haemorrhage.

          Other Governments and companies outside UK are calling us and even 'grooming' us personally to head out of the UK. This is just an observation of what IS happening right now, and has been since the referendum. It's not "Project Fear", its "Project This Is Happening Now at a Disturbing Rate".

  6. soulrideruk Bronze badge

    There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

    Here's an idea, spend £0 on a scheme to identify ways to keep teachers.

    I'll give you the scheme for free..

    Spend £10m on increased wages for teachers. There, done, problem solved with absolutely no public tax money wasted on useless reports.

    1. Brewster's Angle Grinder Silver badge

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      There are 3,436 state funded secondary schools. [Table2a in this .xlsx] So that works out at ~£3000 per school. So that ain't much of a boost.

      1. soulrideruk Bronze badge

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        That's true, but as an initial investment, I think it's a great starting point....

        1. Ucalegon

          Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

          "That's true, but as an initial investment, I think it's a great starting point...."

          Except perhaps I can see that bit of cash simply going straight into a few teacher's pockets as schools do the rounds poaching from each other. Actually retaining a member of staff for education purposes would take far more thought and effort than just money. The whole profession is ... well lacking professional oversight shall we say.

          1. MyffyW Silver badge

            Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

            I hate the idea of teaching subjects I love to indifferent teenagers but for £10m I'll give it a shot.

            1. I ain't Spartacus Gold badge
              Devil

              Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

              Could they not just re-introduce corporal punishment into schools? Then give each teacher a big stick - or even a taser. That should up job satisfaction a bit. Or if not, they'll be able to let off steam about it...

              And if that doesn't work - introduce capital punishment to schools.

              1. Danny 14 Silver badge

                Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                wife recently retired from teaching Chemistry (all year groups in secondary and 6th form) after 26 years in the job. The 90's were the better years - class sizes were good, backup from upper staff good and the budgets reasonable, 00's saw class sizes go up and the infrastructure start to decline, IT was introduced everywhere and things were ok. 10's were the worst by far, crumbling infrastructure, high staff turnover, no support from upper levels, no budgets and kids without support (who would have had 1-1 in the 90s). She was glad to be out and that feeling is echo'd by many teachers.

                The profession is basically boiling down to the same as the NHS - hopefully you can train enough people in 3/4 years to replace the ones who quit after 3/4 years.

                1. MyffyW Silver badge

                  Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                  @Danny_14 said "The profession is basically boiling down to the same as the NHS - hopefully you can train enough people in 3/4 years to replace the ones who quit after 3/4 years."

                  The same grim equation that held sway on the Russian front for a similar period of time.

          2. Anonymous Coward
            Anonymous Coward

            Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

            Except perhaps I can see that bit of cash simply going straight into a few teacher's pockets as schools do the rounds poaching from each other. Actually retaining a member of staff for education purposes would take far more thought and effort than just money. The whole profession is ... well lacking professional oversight shall we say.

            You really know absolutely nothing about the way schools recruit, nor the way they are financially governed, nor that teachers have a statutory regulatory body do you?

            1. Nick Ryan Silver badge
              Mushroom

              Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

              There's one guaranteed way to have the government improve state schools... Close all non-state schools and make it an offence to pay for education. This way all politicians' children will also have to enjoy a state school education and with this in mind it's likely to be amazing how fast government education spending would improve.

              1. DavCrav Silver badge

                Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                "There's one guaranteed way to have the government improve state schools... Close all non-state schools and make it an offence to pay for education. This way all politicians' children will also have to enjoy a state school education and with this in mind it's likely to be amazing how fast government education spending would improve."

                I wonder who put the right to privately educate your child into the European Convention on Human Rights. It seems to only be there to stop anyone trying this.

                1. Anonymous Coward
                  Anonymous Coward

                  Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                  At the risk of invoking Godwin's law, I suspect that the ECHR was thinking about how the Nazi's took control of the 1930's german state education system when they enshrined the right to privately educate your children.

              2. Intractable Potsherd Silver badge

                Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                @Nick Ryan - "... make it an offence to pay for education." I'm wondering how far you want to go with that. I have two-and-a-half year old twins, and I'll be damned if they are going into any institutional education, especially state "schools". They are going to be home-schooled/un-schooled. This means we will be paying for their education through having to work part-time, paying for activities etc. I will stand on my right to decide how my children will be educated, and, whilst I think private schools are disgusting, I can't think of a way to bring it about without being a hypocrite.

                1. Nick Ryan Silver badge

                  Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                  @ Intractable Potsherd

                  I agree, it is a very strange situation to be in - wanting the best for your own children while not wanting a society where those that are able to be successful and those that aren't is dicatated by the level of education that they have available, or where they were educated. Because thisn't good for your own children either.

                  If the state schools were better, would you send your children to them then? Then the solution is there to see...

                  1. DavCrav Silver badge

                    Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                    "If the state schools were better, would you send your children to them then? Then the solution is there to see..."

                    What? Move to a better state? Or somehow become Education Secretary and Chancellor simultaneously so you can sort out the DoE and fund it properly?

                    1. codejunky Silver badge

                      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                      @ DavCrav

                      "sort out the DoE and fund it properly?"

                      I am not sure state schools can improve or at least not with the current approach to handling them. The problem isnt necessarily funding but competition. What are schools striving for? They get kids and they get money from the gov for that so what motivates them? Some selfless desire isnt the answer (some teachers yes but some will be there for a paycheck and the bureaucracy definitely wont be).

                      Add the whims of ministers and I feel very sorry for the teachers suffering it and the kids coming from it.

                      1. SkippyBing Silver badge

                        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

                        Teachers - "Don't privatise education'

                        Also Teachers - "The government isn't running education properly"

      2. DavCrav Silver badge

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        "There are 3,436 state funded secondary schools. [Table2a in this .xlsx] So that works out at ~£3000 per school. So that ain't much of a boost."

        There are about 50k maths and science teachers in secondary schools, so it's £200 per teacher. Although given the answer is

        Reduce workload and pointless admin

        that's £2m/word.

      3. Smooth Newt Silver badge
        Meh

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        There are 3,436 state funded secondary schools. [Table2a in this .xlsx] So that works out at ~£3000 per school. So that ain't much of a boost.

        I guess giving £3000 to school towards those little luxuries, like books and desks, might be a bit of a boost. Probably more than giving the whole lot to management consultants, which is what is actually going to happen.

    2. Dan 55 Silver badge
      Black Helicopters

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      That's easy, the hostile environment will be rejigged so designated key workers won't be able to get a job anywhere else.

    3. codejunky Silver badge

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      @ soulrideruk

      "Spend £10m on increased wages for teachers. There, done, problem solved with absolutely no public tax money wasted on useless reports."

      That is one way to go but from what I hear from teachers it would be better if the gov would step back and stop trying to be in charge of what they dont understand.

      1. SkippyBing Silver badge

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        'That is one way to go but from what I hear from teachers it would be better if the gov would step back and stop trying to be in charge of what they don't understand.'

        That does rather suggest teachers don't understand how Government works.

      2. soulrideruk Bronze badge
        Coat

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        codejunky: That is one way to go but from what I hear from teachers it would be better if the gov would step back and stop trying to be in charge of what they dont understand.

        Well, the teachers need to understand that the very definion of a gov is a group of people trying to be in charge of things they don't understand..

    4. Anonymous Coward
      Anonymous Coward

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      There is a simple way to make teaching less awful: Allow the kids who do not want to be there to leave at the age of 14. Stop using the schools as a way of keeping the youth unemployment figures down. Let them learn that without qualifications they will be spending the rest of their lives doing farm labour or wiping old people's bottoms. Give them the right to 10 years of free education at any point in their lives when they are ready to ask for it and know what they want to do,

    5. Anonymous Coward
      Anonymous Coward

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      ...and the DfE (or whatever the fuck it's called this week) try not treating them like idiots when barfing out yet more amounts of unnecessary curriculum reform. And don't get me started on league tables and the skullduggery that goes on "managing" *them*. That could help too

      1. Anonymous Coward
        Anonymous Coward

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        > And don't get me started on league tables and the skullduggery that goes on "managing" *them*

        A little anecdote: people don't realise just how much a single child can influence the league table results. My wife's primary went from 14th to 3rd in the County league tables by dint of getting ONE child's results removed from the year 6 SATS.

        That child was a war-zone refugee who joined the school just 2 months before the SATS, spoke no English when they joined, could not write in any language, but yet was required by Education Dept rules to take the exam.

        It's right that the Government expects a lot from teachers but to expect them to teach a child English and then 4 year's worth of curriculum in two months is somewhat unreasonable.

        (It took two months to get the child to the point that, when asked to draw a picture, it wasn't of a gun. Or a man with a gun. Or a car with a gun mounted on it.)

    6. The Nazz Silver badge

      Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

      All well and good, but ....

      Yesterday, it was reported that the Chancellor is to give an extra £400m to schools for the (badly phrased) "little extras". Also reported with much derision from the teaching profession.

      I haven't done the maths but i doubt that would cover the "Increase in pay, and pensions" that the teachers DO actually get but often state that they don't get?

      Discipline works both ways.

      1. 2+2=5 Silver badge

        Re: There will be £10m for a scheme to identify ways to keep physics and maths teachers in schools

        I haven't done the maths but i doubt that would cover the "Increase in pay, and pensions" that the teachers DO actually get but often state that they don't get?

        What snide point are you trying to make here?

        Teachers do get pensions - they've never claimed otherwise. They no longer get final salary pensions - they were stopped years ago. Those still teaching who started on final salary schemes have been changed onto lifetime average salary schemes. New teachers are on defined contribution like most private sector employees.

  7. SVV Silver badge

    "friendship with all nations"

    Surely such a gesture would eliminate the need for the extra billion for defence?

    Oh no, sorry it won't, and slightly different in tone to the xenophobic tone that we've been hearing throughout the whole caper too isn't it?

    To my mind it seems to be saying "please please be our friend, because we don't want to be friends with our old friends any more".

    1. I ain't Spartacus Gold badge

      Re: "friendship with all nations"

      Actually increasing the defence budget is about friendship to our current friends. I don't believe we're proposing an alliance with Russia anytime soon.

      I'm sure it would be nice to be friends with Russia too. But it might help if they stopped using horrible poisons on people in our country first.

  8. Anonymous Coward
    Anonymous Coward

    >"friendship with all nations"

    Isn't it strange how the person announcing the new coin with the above motto is the same one that was calling all of Europe our enemies a couple of months back....

    1. Anonymous Coward
      Anonymous Coward

      Strange? Not at all. Politicians are self serving liars and hypocrites. It's what they do.

      I don't know why anyone votes for them.

    2. illuminatus

      but, but...

      if you don't vote for one of the lizards, the wrong lizard might get in!

      1. Anonymous Coward
        Anonymous Coward

        but, but...

        If you vote for lizards, you are endorsing them.

  9. Anonymous Coward
    Anonymous Coward

    a 50p coin commemorating Brexit

    true highlight, this one, is this to reflect a value of £1 as it was before? Hope not!

    p.s. so what happened with this balancing the budget within 10 years by slashing all public services, etc? Slashed them allright, but this balancing seems... as far as it was 10 years ago, eh? :(

    Ah, I see, nevermind the deficit, we won't be around when it comes back to bite us in the ass. Well, it's all funny money anyway, you say 10bn, I say 263bn, who cares....

    1. I ain't Spartacus Gold badge

      Re: a 50p coin commemorating Brexit

      They might not be balancing the budget anytime soon, but I think you'll find the difference before "slashing all public services" is that we used to have an annual deficit of 13% of GDP and now it's down to 1.2% of GDP.

      Once you get the deficit lower than annual growth, then the overall debt-to-GDP level starts to fall (it peaked last year or the year before at just under 89% from memory). No country can long sustain increasing government debt at over 10% of GDP per year. In an ideal world you'd run small surpluses in the boom time, in order to give room to deficit-spend in recessions - or at least that's the Keynsian model. The problem with Keynesian economics is loads of people love it during recessions, when it means more government spending - but many fewer are fans during growth, when it means spending less than you otherwise could.

      1. This post has been deleted by its author

    2. DavCrav Silver badge

      Re: a 50p coin commemorating Brexit

      "Slashed them allright, but this balancing seems... as far as it was 10 years ago, eh? :("

      Not really. The deficit is now low enough that it's below nominal GDP growth. An acceptable level of inflation (~2%) takes care of the rest. If we ran the economy a little hotter (say ~2.5% inflation) it would make things slightly easier.

  10. streaky Silver badge
    FAIL

    Reg...

    Chancellor made it *extremely* clear it's not a digital sales tax. For one thing due to the fact it isn't a tax on sales.

    1. Danny 14 Silver badge

      Re: Reg...

      theoretically wont Amazon et al have to start paying tax in the UK once brexit happens? This bill was looking at ways of taxing digital companies that work outside the tax system.

    2. Phil O'Sophical Silver badge
      Facepalm

      Re: Reg...

      Chancellor made it *extremely* clear it's not a digital sales tax.

      So we have a tax code so complex that companies find it's worth spending a fortune to find loopholes, and how does he propose fixing it? By making it even more complex.

      1. streaky Silver badge

        Re: Reg...

        "So we have a tax code so complex that companies find it's worth spending a fortune to find loopholes"

        Yep. I don't know if there's a good answer to this but generally speaking simpler tax systems are better than complex ones - everybody pays their fair share and you can an have an overall lower rate, which is of course the overriding position of the Conservatives on taxation despite claims to the contrary, the issue is making it happen. If a company intentionally makes no margin to avoid paying taxation I don't see how you can really stop that. This measure seems to be more aimed at companies like Facebook explicitly where the real issue IMHO is companies like your Amazon's and your Starbucks of this world;

        Countries outside the EU aren't having this problem. I was bemused by the point he made after about about companies avoiding paying UK tax (VAT especially) by booking sales to branches in other countries - given that Hammond is somebody who wants to at minimum remain in the single market. Well, that's what Amazon does - hence why I buy things from Amazon EU Sarl. Once we get out the Single Market Amazon will no longer be allowed to use this completely synthetic "fulfilment" relationship where it pays sales tax for UK (and by the way French, German, others..) sales in Luxembourg. The EU can't stop this either because of course the Single Market is a fundamental part of the EU's core reason for being. This is the real problem we have, and it's the easiest one to fix.

        1. Anonymous Coward
          Anonymous Coward

          Re: Reg...

          Some of the Tory party's best friends are accountants.

          More work for them.

          Job done :(

  11. cb7

    A tiny step in the right direction

    But why only 2%? Google is forecast to generate £5Bn of revenue in the UK in 2019. Why can't I pay only 2% tax on the pittance I make?

    And what about Apple?

    I just don't get it. Can someone please explain to me why nobody seems bothered by this?

    1. AMBxx Silver badge

      Re: A tiny step in the right direction

      All new taxes tend to start low. Think about the tax on insurance policies, or even National Insurance.

      Once they see what impact the 2% has, it will slowly increase.

      1. Chronos Silver badge

        Re: A tiny step in the right direction

        Think about the tax on insurance policies

        That one is a particularly regressive tax, especially when applied to things like motor insurance and buildings cover which are legal or contractual requirements for many of us. VAT on utilities when many people are in fuel poverty is utterly insane.

        The other one that really grinds my gears, literally, is paying VAT on fuel duty at the pump. It's value added tax and I see no value in dead money going to the government for idiots like Crapita to waste which, incidentally, did not seem to be a casualty during this period of austerity when everyone was supposed to be sharing the pain.

        It would make a huge difference to people's confidence in the system if it were fair and the proceeds were not being squandered.

        1. Spazturtle Silver badge

          Re: A tiny step in the right direction

          The EU required all member states to put VAT on fuel, so that one is out of our hands for the moment, although several members of the cabinet have said they want to get rid of it once we leave the EU.

          https://europa.eu/youreurope/business/taxation/vat/vat-rules-rates/index_en.htm

          https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32006L0112&from=en

          And Captia keep winning contracts because they submit the best bid, and due to EU rules on government contracts the government is not allowed to use the companies prior performance as a reason to reject a bid.

          https://europa.eu/youreurope/business/public-tenders/rules-procedures/index_en.htm

          https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32014L0024&from=EN

          1. Mooseman Bronze badge

            Re: A tiny step in the right direction

            "The EU required all member states to put VAT on fuel, so that one is out of our hands for the moment, although several members of the cabinet have said they want to get rid of it once we leave the EU."

            Although they don't set the rate of VAT beyond a minimum amount. The rest of it is down to our government screwing us...sorry....extracting the most indirect taxation they can to fund "tax cuts".

            Current motorway service station price per litre of diesel is £1.56 in the UK

            In Luxembourg it's 1.11 eu, or about a quid.

            1. Anonymous Coward
              Anonymous Coward

              Re: A tiny step in the right direction

              In Luxembourg it's 1.11 eu, or about a quid.

              1.7 EU on the motorways in this part of France, so around 1.50GBP

              1. cynic56

                Re: A tiny step in the right direction

                This argument is getting silly. Silly, silly, silly.The last recorded purchase of fuel at a Motorway service station was by Mr Arthur Tremlett in 1973. In his defence he stated that he was wearing the wrong glasses and misread the price.

                Obviously I am excluding purchases by employees whose company car deal also includes free fuel (b*stards).

            2. DavCrav Silver badge

              Re: A tiny step in the right direction

              "Although they don't set the rate of VAT beyond a minimum amount. The rest of it is down to our government screwing us...sorry....extracting the most indirect taxation they can to fund "tax cuts"."

              Although the minimum amount is 15%. And the more important tax for petrol is fuel duty, not VAT.

              1. J.G.Harston Silver badge

                Re: A tiny step in the right direction

                No, the EU-mandated minimum amount that VAT can be is 5%, so resulting in tampons being priced at 3.2p instead of 3.1p.

                1. DavCrav Silver badge

                  Re: A tiny step in the right direction

                  "No, the EU-mandated minimum amount that VAT can be is 5%, so resulting in tampons being priced at 3.2p instead of 3.1p."

                  Fine. There are three levels of VAT: exempt, reduced and full. Exempt is 0%, reduced is 5% minimum, full is 15% minimum. You need a justification for exempt and reduced. 'I like my Porsche' doesn't count.

                2. Anonymous Coward
                  Anonymous Coward

                  Re: A tiny step in the right direction

                  No, the EU-mandated minimum amount that VAT can be is 5%

                  It depends on whether the item is defined as a luxury or a necessity, the minimum is different.

            3. Anonymous Coward
              Anonymous Coward

              Re: A tiny step in the right direction

              In Andorra, I recently paid 0.90 eu. I simply could not believe it.

          2. Ochib

            Re: A tiny step in the right direction

            A contract must be awarded on the basis of either:

            Lowest price: The lowest priced tender wins. No other element of the tender may be taken into account; or

            The most economically advantageous tender (MEAT): Factors other than or in addition to price, like quality, technical merit and running costs can be taken into account.

            If MEAT is used:

            the contract award criteria (e.g. "price, quality of services, risk to contracting authority etc.") and any sub-criteria must be set out either in the OJEU notice or the tender documents; and

            the weighting of each criterion (and sub-criterion, if weighted) must also normally be given, either as an exact number or as a meaningful range (e.g. 'price: 30%-40%'.).

            Public procurement law: the basics (https://www.out-law.com/page-5964)

          3. sed gawk

            Re: A tiny step in the right direction

            Had a grep through your links, care to point to the section enforcing "EU rules on government contracts the government is not allowed to use the companies prior performance as a reason to reject a bid."

            I'm struggling to locate the text, it seems at odds with the general thrust of the document, which although dry, seems rather anodyne and unthreatening, positively sensible even.

            Perhaps, I'm not seeing it, would you mind pointing it out.

    2. phuzz Silver badge
      Devil

      Re: A tiny step in the right direction

      "Why can't I pay only 2% tax on the pittance I make?"

      If taxes weren't designed to make the rich richer, and screw everyone else, what would be the point of them?

    3. codejunky Silver badge

      Re: A tiny step in the right direction

      @ cb7

      "But why only 2%? Google is forecast to generate £5Bn of revenue in the UK in 2019. Why can't I pay only 2% tax on the pittance I make?"

      To start with you are not Google. Apart from being private entities you are an actual real person while Google is a construct entity that is not a real person. How many people do you employ? How much R&D do you provide to the private market for people to use as services or products?

      Tax has 2 uses- fund things people want for people and to make less desirable certain behaviour (sin tax). This is where taxing business is a lie, it actually comes from people not 'the business' (people care about money, the business has no wants nor desires) and do we really want to consider delivering products/services people want, creating jobs and improving lives as undesirable? Of course not.

      I am bothered by this but not that Google will only pay 2%, but that Google will be paying 2%.

  12. Anonymous Coward
    FAIL

    And extended IR35 in 2020...

    Even now, HMRC is bulk-purchasing lube for the inevitable deep probing that will take place. Well at least we've got the latest Apple announcement and whatever funny thing the orange skinned small-handed one has tweeted to look forward to.

    Disclaimer: I am not a contractor.

  13. Robert E A Harvey

    "Going alone"

    I suspect that "Going alone" will rapidly turn into "blazing a trail" and then "leading the pack" until it becomes some sort of self-levelling normal.

  14. Robert E A Harvey

    Design for the coin

    I suspect it needs to be riddled with holes, and thus be a hollow sham.

    1. DavCrav Silver badge

      Re: Design for the coin

      "I suspect it needs to be riddled with holes, and thus be a hollow sham."

      I think a coin is a perfect metaphor for the vote. After all, 52-48 is more or less tossing a coin.

  15. Keith Langmead

    Taxes on "profits"

    I struggle to see how much of a real difference this will actually make. Excluding money they ferret away to other countries, the main reason as I understand it that the big companies pay very little in the way of corporation tax is that it's based on profit, and companies like Amazon they spend it / reinvest it rather than leave the profit on their books where it's taxable. So how is a new tax which is also based on profits (according to what Hammond said in his speech) going to help? Surely they'll just continue as they do now and still pay very little tax since they still won't "make a profit"?!?

    1. Spazturtle Silver badge

      Re: Taxes on "profits"

      It's a gross revenue tax, not a net profit tax.

    2. Boris the Cockroach Silver badge

      Re: Taxes on "profits"

      They dont always spend the cash flow on R&D.... it goes in 'Buying IP from suppliers"... in other words, google UK buys intelectual property from google US in spite of the fact that google US own 100% of google UK..

      Which is a bit of a piss take.

      Especially if search engine UK based here in dear old blightly has to pay MORE in tax than google

      Heck looking at some of figures I bet the small co I work for pays more in tax than google et al

  16. EnviableOne Bronze badge

    Amazon wont get hit

    if you look at there accounts, they only made 2% on turnover, google, zuck, Tim and SatNad's lot made nearer 25% on turnover

  17. Wolfclaw Silver badge

    You can gurantee that the fat cats corps already have their accountants, lawyers and other shady people, going over the new rules, to see how to bend them to pay no tax !

    1. J.G.Harston Silver badge

      Easiest way to pay no profits tax is to make no profits by paying your staff loads of money. Unfortunately, that means you end up paying payroll taxes instead, often *more* than the profits taxes you would have paid if you'd not paid the staff more money.

  18. Anonymous Coward
    Anonymous Coward

    Clever scheme

    As was pointed out on Radio 4 this morning, the detail of the scheme is rather clever, as it taxes the point of offer for services, rather than the point of fulfilment for services.

    The value of Facebook, Amazon etc is its customer base, and a significant portion of that is in the UK, but the taxation occurs in Ireland or Jersey or Lichtenstein or wherever when the back-end sales subsidiary gets paid for something from those UK customers.

    The Govt can't easily change that, but can, in effect, charge 'shop rent' or '[virtual] land tax' for the display of those services to us, thereby getting some revenue proportional to the value to the parent company that our visits to their sites represent.

    The only way they can avoid it is not to present services to us and so not make any profit at all from us, which would be somewhat self defeating.

    It's also separately enforceable per country, so it makes take-up easy and the use of existing models for tax harmonisation also straightforward.

    Basically he's saying to the OECD 'Here's your solution, now pull your fingers out'

    Well done!

    /Not a Tory

  19. FractalFragger2018

    What about her husband?

    How about the UK government run by the nasty party start billing all corporations fairly - G4S has not paid their tax bill in years because Teresa Mayhem's husband is on the board.

  20. Fokko ukena

    Googoo

    Why not let them keep the money and see if they can provide services effectively that the government never seem to be able to do. Surely it's going that way. Replace the nation state with orgs who can seemingly organise innovatively. Keep the flags and poppies for nostalgia.

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