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Big Tech raise advertiser, developer fees in response to digital taxes in Europe

Several European countries — the UK, France, Italy and others — as well as Turkey, have in the recent past begun taxing technology companies, including the giants, with digital services taxes. Talks for developing a global framework for digital taxes fell apart after the US pulled out of negotiations earlier this year, stating that the levies discriminate against American firms and are unfair. European countries went ahead with bringing their proposed taxes into effect. However, American companies have announced that they will pass on the additional tax burden onto their customers. This goes against the intention, since the taxes were aimed to net in revenues from giant foreign tech firms. The UK has a high threshold for taxing digital services, it's 2% levy applies to firms that have over £500 million in annual revenue, of which £25 million is taxable in the UK. Giants have begun passing on tax to customers Apple on Tuesday said developers will soon be charged increased levies on their revenues. In the UK, a developer will now pay an additional 2% on their revenue over and above the 20% VAT that's already applicable. Similarly, developers in Italy and France will pay another 3% over existing VATs. The remaining revenue will be split between Apple and the developer. Despite being aimed at capturing revenue from technology firms, the burden is being passed on to app makers. In addition, prices of apps and in-app purchases will increase by 7.5% — the digital tax rate Turkey is charging.…

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