Tax breaks for tech giants a flawed approach, says NUJ

The union is deeply concerned about possible changes to the Digital Services Tax (DST) after Rachel Reeves, UK chancellor, confirmed she was considering tax breaks for US technology and social media giants such as Amazon, Google, Meta, and X.

In an interview with the BBC’s Laura Kuenssberg, Reeves confirmed “ongoing” discussions around the tax, fuelling speculation that the tax could be reduced or scrapped entirely to avoid tariffs on UK exports by the Trump administration.

The NUJ strongly opposes any reductions to DST. Last year the union published its updated News Recovery Plan, calling for a windfall tax of 6% on tech giants plus an ongoing digital tax to reinvigorate the news sector.

DST only applies to companies whose worldwide revenues total more than £500m and who derive more than £25m in revenues from UK users. Since its introduction in 2020, the 2% tax on search engines, social media services, and online marketplaces has raised between £800m to £1bn a year. The NUJ has repeatedly expressed its concern over the significant financial gain for technology companies obtained through digital advertising revenue using editorial content, without contributing to its production or providing fair remuneration for journalists.

Laura Davison, NUJ general secretary, said:

"Any talks by government on the Digital Services Tax should be focused on its increase to ensure tech giants pay their fair share. Considering further concessions to some of the world’s wealthiest companies is a deeply flawed approach and one the Chancellor would be wrong to pursue. Investing in quality news is vital to democracy, the public interest, and the UK’s financial and cultural growth. Any review of DST must recognise the need for its increase."

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