Oral Answers to Questions

Vince Cable Excerpts

Tuesday 17th April 2018 Commons Chamber

[Mr Hammond]

As my hon. Friend will know, the UK was one of the first countries to implement the OECD model for country-by-country reporting to tax authorities. Those reports have been required for periods that started on or after 1 January 2016. On public reporting, the Government are committed to a multilateral approach to ensure that reporting provides comprehensive information and is fair between UK-headquartered and non-UK-headquartered multinationals. We are engaging constructively on the EU proposals for public country-by-country reporting, which we see as a step in the right direction.

[Sir Vince Cable (Twickenham) (LD)]

The Chancellor will be aware of President Macron’s proposal for taxing the revenue of the big internet platforms, which the Chancellor acknowledges are difficult to tax under the existing rules. Are the Government considering building on the entente cordiale of recent days by co-operating with and learning from the French model for how we should tax that revenue?

[Mr Hammond]

I would not call it a French model; it is a Franco-German initiative. We have been working closely with the French and the Germans on this issue. We discussed it at the G20 in Buenos Aires a couple of weeks ago and we will discuss it again at the informal ECOFIN meeting in Sofia at the end of next week. The Government’s position is that we are supportive of the EU proposals, but we want to be clear that any such measure can only be a temporary solution. The long-term solution has to be an agreed multilateral approach to the taxation of the digital economy. That requires us to get the United States on side, because most of these global digital companies are domiciled there. Without the United States’ co-operation and support, it will be difficult to make any tax system sustainable.