Rebirth of England.

Chapter 975 Intolerable
In fact, Britain has also invested a lot in network infrastructure. Before this, they launched the "Broadband Promotion Plan" and used the funds returned by the BFT Fund to invest in the construction of broadband networks.

When Standard Chartered Bank acquired Northern Rock Bank, it also assumed its £250 billion debt that was rescued by the British government.

At that time, in accordance with the agreement between Barron and the British government to assume these debts, the British government once again invested 250 billion pounds into the British Fortune (BFT) fund established by Barron. Through the investment, he will return a total of 500 billion pounds plus corresponding interest to the British government.

Prior to this, the BFT Fund had returned 25% of the funds and corresponding interest to the British government, totaling more than 135 billion pounds. These funds will be used to invest in plans to promote Britain's broadband infrastructure within five years.

For this reason, the current network conditions in the UK have been greatly improved compared to the original time and space.

However, the British government found that the Internet bandwidth in their country was mostly used by Internet giants such as Google, Yahoo, and Amazon, but they did not get much tax back from these Internet giants.

These Internet giants often choose to establish branches in tax havens under the guise of "active tax optimization" to reduce the taxes they pay in overseas markets.

According to the survey, Internet giants such as Google, Yahoo, and Amazon have been enjoying single-digit effective tax rates on their non-US profits, which is about a quarter of the average tax rate in their overseas markets.

Generally speaking, "taxes are taken from the people and used for the people." This applies to most individuals and companies. As long as you engage in economic activities in a country or region, you must pay taxes to the government of this country or region. And since most economic activities are visible or measurable, taxation will exist.

Some taxes are experienced by ordinary people, such as the personal income tax paid every month when they get their salary. Some taxes are not experienced by ordinary people, such as the consumption tax when buying things, the value-added tax paid by enterprises to the government, etc.

However, for some special companies, it may not be so easy to impose taxes on them. The most obvious example in this regard is undoubtedly Internet companies.

Internet companies, especially large Internet giants like Google, Yahoo, and Amazon, use the Internet, a global super infrastructure, to provide their services to people around the world, but their income is not taxed everywhere...

This is because it is very likely that people in the UK have seen a lot of ads using Google, which has brought a lot of revenue to Google, but in fact the advertisers may not be in the UK, and all these revenues are paid to Google in the United States.

So from a taxation perspective, Google may have paid these taxes in the United States.

In particular, the tax rates of different countries are actually completely different. Some countries have heavier tax burdens, while some countries have lighter tax burdens. In particular, some overseas island countries known as "tax havens" have become the most common way for many Internet companies to "reasonably avoid taxes."

For example, Apple, in order to avoid income tax of more than 35% in the United Kingdom, the United States and other countries, successfully avoided US$2012 billion in taxes in 120 alone through subsidiaries in low-tax countries such as Ireland.

The process is that Apple establishes a subsidiary in Ireland, where the tax rate is extremely low, and then uses this subsidiary to provide services to its branch in the UK, transferring most of the profits in the British market to the Irish subsidiary in the name of "service fees" and "licensing fees".

In this way, Apple's branch in the UK will have almost no profit and only need to pay extremely low taxes; and because Ireland has an extremely low tax rate, they only need to pay very little tax.

Of course, as the global hegemon, the United States can use long-arm jurisdiction, and Apple certainly cannot be exempted from paying too much tax to the United States, but Britain and other European countries have no way to deal with Apple's practice... Similarly, companies like Google will transfer tens of billions of advertising revenues to offshore tax-avoiding subsidiaries registered in Bermuda every year, thus avoiding billions of taxes - between 2006 and 2011, Google paid only more than one million euros in income tax in European countries such as the United Kingdom, Germany, France, and Italy.

As for companies like Woaw, DailyVedio and Argos Retail Group, they also use a lot of bandwidth, but because their headquarters are in the UK, especially DailyVedio and Argos.com, their main markets are in Europe, and their advertisers are mainly European companies. Compared with those American Internet companies, they pay slightly more taxes to the UK and other European countries.

Although they will use some "reasonable tax avoidance" methods, their main base is in Europe and they will not go too far.

So for companies like Google, Yahoo, Amazon and Apple, which make huge profits in the British and European markets but only pay a symbolic few million in taxes, while Britain alone has invested tens of billions of pounds in improving its broadband network, this naturally makes them very dissatisfied.

The so-called digital tax is actually a service fee levied on these Internet giants for their use of network infrastructure.

According to the British government, they will impose a "digital tax" on companies with global revenue exceeding 5 million pounds and revenue exceeding 2500 million pounds in the British market - this also means that this tax is levied on Internet giants of a certain scale and will not put pressure on Internet start-ups.

In other words, by the time you need to pay the "digital tax", it means that the company has already reached the scale of a major Internet company.

Although the collection of "digital tax" will inevitably affect companies controlled by Barron, such as Woaw, DailyVedio and Argos.com, after all, even if they can avoid paying this tax in the UK because they pay more taxes to the British government, if other European countries and even countries around the world gradually impose such taxes, these companies will still increase their tax burden.

But in comparison, once the "digital tax" is levied, their competitors, such as Apple, Google, and Amazon, will be more uncomfortable.

It can also increase government revenue and help Europe strengthen its network infrastructure. Barron can accept these burdens.

But then again, in Barron’s previous life, countries including Europe, Japan, and South Korea had thought about imposing a “digital tax”, but in the end…

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It is quite difficult to collect this fee.

After all, these companies are all American companies. They cannot evade American taxes... or they dare not evade too much. So America, as the base camp of these Internet companies, will definitely stand up and speak out for these Internet giants, and may even use retaliation to threaten Britain and other countries to compromise.

In addition, it is very troublesome to calculate the tax base of the "digital tax" because the revenue data of Internet companies in the UK are not announced. It is actually difficult for the British tax department to grasp how much money these Internet giants have made in the UK...

The same is true for other countries...

Of course, as listed companies, these companies publish their own financial reports, but they can choose not to disclose the specific income and profit situation of certain regions in their financial reports. So how to collect this money is not an easy task for the tax authorities in the UK and other European countries.

(End of this chapter)