Google Adding 2% Tax For Ads In The UK

When looking up things like king kong advertising reviews on the internet, Google is the household name. In turn, this means that getting ad slots on the search engine is something that companies fight for.

Naturally, that doesn’t come free, and it’ll be costing a bit more for Google UK platform advertisers, as the new UK Digital Services Tax took into effect in April 2020, and the tech giant will be passing the cost to the advertisers on its platform.

The legislation was implemented on the very first day of April 2020, which introduces a new 2% tax on all the revenue made by search engines, social media services, and online marketplaces that make their money from users residing in the UK.

The UK Digital Services Tax’s intention is to get some of the revenue that large foreign companies get on the UK’s digital space. This tax, notably, is only charged for large-scale businesses, those that make at least £500 million annually, provided that at least £25 million of that is sourced from UK sales.

The legislation and the associated tax are seen as a temporary measure, meant to hold the line until a global taxation solution is found for digital services, like advertising and king kong advertising reviews and the like.

Google made the announcement around late August 2020, where they stated that they’ll be passing the cost of the UK Digital Services Tax, the 2%, to advertisers operating on their platform, effective starting on the first day of November 2020. In short, Google’s upping prices to account for the tax, and making advertisers shoulder the addition.

The tech giant’s statement says that digital advertising costs increase with the implementation of digital service taxes, and that these costs are typically borne by customers. The tech giant also encourages governments across the world to work on international tax reforms.

UK DST Fee on Google Invoices will have the tax appear on its listings. As for specifics, Google Ads and YouTube ads will be affected by the tax, but not DV360, as the DST doesn’t apply to sales themselves, only to the companies intermediating such sales.

Notably, the Digital Services Tax for Austria and Turkey sits at 5%.

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