Budget 2018: Facebook, Twitter and Google face new £400m tax on their profits

FACEBOOK, Google and Twitter face a new digital tax on their profits, it has been revealed today.

Chancellor Philip Hammond said he would slap a new tax on tech giants from 2020 onwards, hoping to raise £400m to pay for public services.

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He said that digital tech giants would be taxed two per cent on the money they make from UK users.

Mr Hammond was quick to reveal that it won't be a tax on things bought online - so won't be passed on to the consumer - but will be just on services and aimed only at the huge tech firms.

"We are serious about this reform," he told MPs today, saying it would hit companies which make more than £500million per year, not tech start ups for which London is famous.

And in a quip at Nick Clegg, who is off to work for Facebook, he joked: "I'm already looking forward to my call from the former leader of the Liberal Democrats!"

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As revealed in his Tory conference speech earlier this month, Mr Hammond said the tax-dodging giants would be made to stump up more as part of his 21st-century blueprint to defeat Corbynism.

He wants to put the new system in place within two years, and will push ahead with it after losing patience with the US for not acting quickly enough.

But already MPs were quick to criticise it - saying it didn't go far enough and wouldn't collect much revenue at all.

Labour's Tom Watson said that it would only be around 1.3 per cent of the big 5 tech firms - just a drop in the ocean.

He stormed: "The tech giants do need to pay more in tax, but the measure announced today is pittance for these massive international companies.

"The new tax isn’t even set to be implemented until 2020 at which time the tech giants will start to enjoy a 2 per cent cut in their corporation tax rate."

And MP Liz Kendall said: "£400m sounds a lot but it’s pretty low when you look at profit these huge digital companies make."

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Highlights of today's Budget include:

• The national living wage rising to £8.21 per hour, up 4.9 per cent on last year
• A £500million pot for No Deal Brexit preparations
• Fuel duty frozen for the ninth year in a row - in a victory for The Sun
• Duty on beer, cider and spirits frozen while tobacco tax goes up again
• An extra £2billion for mental health, with specialists installed in every school and hospital, and £650million for social care
• The Ministry of Defence will get another £1billion to keep Britain's military in shape
• New funding to repair crumbling roads across the country and end the country's pothole epidemic, adding up to £30billion over five years
• £400million for schools - adding up to £10,000 per primary and £50,000 for every secondary
• An increase of £160million for counter-terror policing
• The end of PFI contracts in the wake of Carillion's collapse
• £1.5billion more to help out the struggling High Street - including a cut to business rates
• Interest-free loans to Brits who can't repay their debts to payday lenders
• Tweaks to the law on weddings which will allow many more venues to host cut-price ceremonies
• Visitors from the US, Canada, Australia, New Zealand and Japan will be able to use e-gates at airports - currently open only to EU citizens
• A new 50p coin commemorating the moment we quit the EU in March next year

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