UK to Keep Digital Services Tax Until OECD Deal

Overview

• A statutory review released alongside the November Budget says the 2% levy will remain in force unless a multilateral OECD solution takes effect.
• The tax raised roughly £800 million in 2024–25 from a small group of multinationals, with most receipts concentrated in five firms.
• The OBR projects receipts to grow to about £1.4 billion in 2030–31 and to total £7.3 billion over the next six years.
• Washington pressure has intensified after a Trump executive order directing the USTR to consider reviving section 301 probes, raising the risk of retaliatory tariffs on UK exports.
• The review notes some pass-through to consumer prices and no evidence of fraud, while industry groups call for repeal and tax campaigners urge keeping or strengthening the measure.