Theresa May says another general election 'wouldn't be in the national interest'

Philip Hammond will unveil a commemorative Brexit coin to mark Britain's departure from the EU it has been

Philip Hammond will unveil a commemorative Brexit coin to mark Britain's departure from the EU it has been

While the details of the new tax will be out after the government consults experts in the field the tax will be created to ensure it is established tech giants - rather than local tech start-ups shoulder the burden of this new tax.

Economics experts at the Fraser of Allander Institute have estimated if Mr Mackay increased the threshold for this in line with inflation, someone earning £50,000 a year in Scotland would pay £1,100 more in income tax than they would elsewhere in the UK.

The UK government has called on digital platforms including Facebook and Amazon to "pay their fair share" with a 2% revenue tax.

The announcement came as Hammond splashed out on health services in a spending plan signalling the easing of eight years of austerity with a modest uplift in public spending and few major tax increases.

Britain will introduce a new digital services tax aimed at tech giants from 2020, finance minister Philip Hammond said on Monday, responding to public outrage over low tax payments.

It won't be until the tax year 2022-23 that it will raise the £400 million mentioned by Chancellor Philip Hammond in today's budget, and £440 million the year after, according to the OBR's forecasts.

He said the tax will be "narrowly-targeted" on the UK-generated revenues of specific digital platform business models. He said that while a global agreement on how digital taxes shall be implemented would be an ideal solution to the issue, talks at a global level have been slow.

The Office for Budget Responsibility (OBR), meanwhile, also issued its analysis of the proposed new tax.

The Digital Services tax is set to affect the bigger tech giants rather than the smaller startups trying to establish themselves in the country. Companies have been accused of falsely reporting or reducing profits in order to pay less tax.

For the United Kingdom government, their attempt to tax internet businesses may prove to be easier as a consensus is needed between the EU-27, At present, the Czech Republic, Ireland, Luxembourg, and the Baltic States are said to be opposed to the move. A two per cent tax rate would be applied to sales that qualifying firms make in the UK.

But 24 hours after his Budget it emerged the Chancellor plans to snatch back half of the £730 tax break handed to millions of workers by increasing national insurance contributions. The government expects it to raise more than $510 million a year.

This is the tricky aspect of the new tax; how do you hold the internet giants accountable within placing too much of a burden on the start-ups?

The Annual Investment Allowance (AIA), is a form of tax relief for British businesses that is designated for the purchase of business equipment.

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