The purpose of unilateral action is to encourage the OECD/G20 to get their finger out. If nobody says we're going to do it anyway, the Americans can keep stalling and nothing gets done.
Last time this thread came up I explained at length why nothing (positive) is going to get done with the DST or rEU variants. Only an OECD level setup might work. That post is quoted at the bottom of my reply.
There's already so many loopholes in the DST proposals that those of us in the field are already so confident that we can structure around it that our only concern is the cost to the country of trying to make it work and inadvertently walloping domestic firms that were never the intended targets.
Any content publisher (Oxford press etc) will have content, a search engine, and users. They're far more likely to be hit with DST than Google is.
We will literally be spending a lot of money developing and trying to collect this tax, and we'll never raise more than it costs us. It's a waste of money on political engineering.
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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.
Biting the hand that feeds IT
