United Kingdom announces digital services tax on tech giants

Philip Hammond with his Budget briefcase

And it warned that tax rises are "all but inevitable" in the longer run to pay for the pressure on the NHS of Britain's ageing population.

IFS director Paul Johnson said any hope of meeting a target to eliminate the deficit by the mid-2020s was "for the birds".

He added: "What the Chancellor said yesterday was that he would use the fiscal reserves that we have built up through hard work and sound economic management to ensure that Britain will succeed whatever the circumstances".

Mr Field said cuts for families would in fact get "worse next year and worse the year after and worse the year after that".

But he added: "On wider definitions, it doesn't, at least not yet".

Here, Daniel Owen-Parr, head of professional sector and auction at specialist lender Together looks at what Monday's Budget mean for first-time buyers, home owners - and professionals working in the property industry.

Former work and pensions secretary Yvette Cooper said: "People on £90-100k a year will get tax cut worth £860 in April, those on £125k will get £600 - far more than low-paid workers, at a time when child poverty is going up, benefits are being cut, vital council services are being cut, police are badly overstretched". Cuts are not about to be reversed.

The income tax threshold will rise next April to £12,500 for personal allowance and £50,000 for the higher-rate threshold. The new tax is expected to raise about £400m a year.

"It's a judgement that could see debt ratchet upwards", Johnson said.

Responding on Twitter to comments made by the shadow chancellor, Mr Burnham, now mayor of Greater Manchester, wrote: "At a loss to understand why we are doing this".




The Prime Minister and Chancellor will face more than 100 business leaders and major investors as they seek to win support for the Budget plans.

"Yes, the OBR reduced borrowing forecasts so he was able to find more money without committing to more borrowing".

"Suppose the public finance forecasts deteriorate significantly next year?"

"Some people still think shared ownership is only for key workers in London and the South East but purchasers don't all fit in one mould - this market is strong, healthy and growing across the United Kingdom and offers a way to help more people to have the home they want". "What will he do then?"

It was "an old-fashioned giveaway budget" that was "as much about politics as economics", said the Financial Times.

This sort of sleight-of-hand exemplifies what is wrong with the current splitting of our tax on income into two parts. "More likely he would just allow borrowing to persist at a higher level".

Downing Street confirmed that budgets for departments other than health, defence and aid would rise overall in line with inflation over the coming period, but was unable to guarantee than none would see a real-terms fall.

"The announcement that the Government will introduce a new Structures and Buildings Allowance for non-residential structures has gone some way to meet our call for tax relief on investment in farm infrastructure and will help farmers invest in modern, efficient buildings".

It will be carefully created to ensure it is established tech giants – rather than our tech start-ups - that shoulder the burden of this new tax.

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