Apple, Google, and Amazon respond to European tech taxes by passing on costs

Developers, ad buyers, and third-party sellers are all affected

For many years, Europe has been unhappy with the tax habits of US tech giants. As regulators and politicians have often noted, these firms make vast amounts of money from European citizens but pay a pittance in tax. In the absence of an overhaul of the global tax system, a number of European nations have introduced new taxes aimed specifically at these companies. And the tech giants are responding by passing on the costs.
Over the last month, for example, Apple, Google, and Amazon have all announced price changes for UK enterprise customers specifically designed to offset a new introduced by UK government. This increases tax on any revenue produced by “search engines, social media services and online marketplaces” by 2 percent.

In response, Apple is changing how it pays on the App Store in the UK. On top of the usual 20 percent VAT it pays to the government on each purchase it’s adding an extra two percent before splitting what remains between the developer and Apple, meaning less money for both. Google, meanwhile, is increasing fees for all advertising bought on Google Ads and YouTube in the UK by 2 percent.

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