UK introduces 2% tax on search engines, social media and online shopping

Last year, the Trump administration pledged to impose significant import taxes on several French products after the French government announced a "digital services tax" that directly affects companies such as Google, Apple, Facebook and Amazon.

France was followed by the UK, which announced it would tax revenues from digital services from online marketplaces, search engines, social media, streaming services and nearly all online businesses that make money from UK Internet users from April 2020 onwards.

The Digital Services Tax (DST) will apply to multinational companies that generate over £ 500m in annual revenues - but only if at least £ 25m of this comes from UK users. In this case, the tax will be 2 percent.

HMRC (Her Majesty's Ministry of Revenue and Revenue) will spend £ 8m on developing the IT systems and processes needed to monitor and administer the newly introduced tax, with an estimated impact expected to range from £ 280m in the first year to more than £ 500 million thereafter.

This decision will disproportionately affect American companies, which will inevitably lead to increased tensions between the two countries. At a meeting in Davos in January, US Treasury Secretary Steven Mnuchin hinted that the likely US response to the DST would be a levy on UK car exports.