‘End to one rule for big guys and another for small ones’
corporations which make at least £500million a year worldwide and is thought likely to affect about 30 companies.
The same would apply to advertising earnings for social media giants like Facebook and Twitter.
Online market places such as Amazon and eBay would be taxed on the “cut” they take from sellers using the site.
The tax charged would be based on companies’ own assessments – but the Government insists it does not expect such “large and sophisticated data experts” to cheat.
Mr Hammond told MPs that digital platforms were a “standout example” of where tax rules had not kept pace with modern developments.
He said: “It’s clearly not sustainable or fair that digital platform businesses can generate substantial value in the UK without paying tax in respect of that business.”
He said the UK had led attempts to find a global agreement: “But progress is painfully slow. We cannot simply talk forever.”
Shares in US-listed Amazon – whose UK arm paid £1.7million tax last year, despite profits nearly trebling to £72.3million – dropped almost five per cent on the announcement. Netflix and Google shares also fell.
The CBI warned it was “high risk” for Britain’s “competitive edge in digital” to act alone. Dan Neidle, of law firm Clifford Chance, said targeting US tech giants could annoy Donald Trump at a time when Britain was working for a post-Brexit free trade deal with the US. BRITONS who set themselves up as private companies will be forced to pay National Insurance contributions, under new rules announced by the Chancellor.
The reform will affect around 150,000 freelancers working full-time for large companies.
They will now be taxed as employees under the IR35 rule. It will come into force in April 2020 and follows a similar move in the public sector.
Mike Hibbs, lawyer at Shakespeare Martineau, CHRIS Forbes, 42, set up The Cheeky Panda with his partner Julie Chen, 36, in 2016.
They sell 100 per cent bamboo tissues and toilet rolls and a plastic-free product range.
In their first month they sold £2,000 of goods and now sell £20,000 worth each month.
Their tissues are sold in supermarkets like Tesco and Morrisons in the UK, and 12 other countries. The business is now valued at £20million.
Chris who lives with Julie and their baby son Leo in Brentwood, Essex, said: “I’m delighted the Enterprise Investment Scheme, offering tax breaks on shares has been kept and improved. All
FREELANCERS HIT WITH NI pAymENTS
yesterday said: “Following the roll-out of IR35 to the private sector, businesses will have to be far more stringent with their employment checks.”
He added: “Incorrectly identifying people as an employee, a worker or selfemployed could have serious financial implications for organisations going forward.
“Ensuring that employment contracts accurately reflect the circumstances of an employee’s engagement will also be essential.” eight of my staff are autoenrolled in the Government pension scheme, but we have also offered the EIS as an extra incentive. Increased tax thresholds is also very positive.
“I was very pleased to see the Government clamping down on large companies’ international tax dodging schemes, as it felt like one rule for the big guys and another for us small guys.
“Reducing business rates also helps smaller companies and the wider economy, so we’re very pleased with the Chancellor.
“It’s also a good pre-Brexit Budget which will steady nerves and allows us to be even more bullish about the future.”