London – The UK government has published a review required by legislation into the functioning of the UK’s Digital Services Tax. The review finds some evidence of impacts on consumer prices, but beyond that, largely restricts itself to noting ongoing growth in the digital economy. There is no meaningful consideration of potential changes and the UK continues to indicate that it will maintain the tax unless an “appropriate global solution is in place.”
While many countries are either shelving or repealing digital taxes aimed largely at U.S. technology companies, the UK’s 2 percent DST, which took effect in 2020, collected $1 billion from largely U.S. companies in 2024.
President Trump signed an executive order in February directing the U.S. Trade Representative to explore resuming 301 investigations of these DSTs.
The Computer & Communications Industry Association has advocated for open markets since 1972.
The following can be attributed to CCIA Senior Director and head of CCIA’s London office, Matthew Sinclair:
“It is disappointing that the Government has not taken the opportunity presented by this review to look again seriously at the arbitrary and distortionary Digital Services Tax. With longstanding concerns in the U.S. about taxes that single out multinationals headquartered there, this tax will continue to create unnecessary risks to trade and cooperation between two countries that otherwise have many interests in common as the largest global exporters of digital services. Ministers should work towards ending this tax and seizing the investment, growth and revenue opportunities presented by growth in the global digital economy.”
