Government publishes Finance Bill 2019-20 draft legislation
The government has published draft legislation for Finance Bill 2019-20.
One of the primary objectives included in the draft legislation is to 'update tax policies for the digital age'. The legislation outlines that, from April 2020, large digital firms will be required to pay a new Digital Services Tax (DST). The DST will apply a 2% tax to the revenues of certain digital businesses.
Commenting on plans for the new DST, Jesse Norman, Financial Secretary to the Treasury, said: 'The UK has always sought to lead in finding an international solution to taxing the digital economy. This targeted and proportionate DST is designed to keep our tax system in this area both fair and competitive, pending a longer-term international settlement.'
Additionally, the draft legislation also provides further details on the extension of off-payroll working rules to the private sector. The extension will take effect from April 2020, and will 'ensure that two people working side-by-side in a similar role for the same employer pay the same employment taxes'.
Provisions to combat tax abuse using company insolvencies are also included in the draft legislation. According to the government, the measure aims to 'tackle the small minority of taxpayers who artificially and unfairly seek to reduce their tax bill through the misuse of the insolvency of companies'.
Consultations on the draft legislation are set to close on 5 September 2019.