Windfall Tax On Google And Facebook? You're Kidding, Right?

If you read one thing on the first day back in the office, it should be The Sunday Times interview with Security Minister Ben Wallace. It is quite staggering.

To be honest, the message is rather familiar. No matter how strong the language used appears, the outcome remains the same. Empty threats of extra tax the public will lap up, but will never be acted on.

Until now, the social giants have come in for criticism for not reacting quickly enough to requests to take down extremist content. The Prime Minister and Home Secretary made comments throughout 2017 about how Facebook, YouTube, Twitter and WhatsApp needed to do more to combat hate and extremism. This new article, however, is somewhat of a departure.

You'll have to read the article to get the tone and to understand that this the government wants to appear to be stepping forward in a more forthright manner in 2018. Wallace's main point could be summarized thus -- that the British public need to understand the social media giants are not cuddly geeks sitting around on beanbags. Instead, they are profit driven and ruthless and cutting corners by not accepting their responsibilities to tackle the problem they are creating. 

The article draws the conclusion that the Government could be preparing a windfall tax, as levied against the utilities in the '90s by Tony Blair. Certainly, Ban Wallace makes it clear that if the social media giants do not do more, they will be hit with some form of unspecified tax.

That tax word is a tricky one with the social giants, because as anyone with half a brain will tell you, the British public are fed up with the duopoly of Facebook and Google not paying their fair share. Those who know a little about digital marketing would add that taking two in every three pounds spent on digital marketing in the UK and then using fancy accounting practices to avoid UK tax makes this all worse.

So this could be the way to get some money out of them. If they won't pay normal tax like you or I and the companies we work for, why not just hit them with record fines or a windfall tax? The approach seems to be working for the European Commission right now after last year's record levy against Google, which is expected to be followed by at least one more this year. Google has agreed to mend its YouTube ways, but only after two mass advertiser boycotts in 2017.

No politician will be brave enough to admit that this has crossed their mind, but it must have. If the duopoly are not going to pay tax, there really is little to lose by threatening them with a windfall tax unless they do more to tackle extremism. The Government will either get a windfall amount to help pay the Brexit divorce bill or they score a major victory in the battle against extremism.

As ever, the specifics are elusive. In Germany today we have the enforcement of a law that requires social giants to remove extremist content within 24 hours or face a fine, while with the UK, we just have open-ended threats.

And why don't we have the specifics? Because Google and Facebook are exactly the kind of high-profile Silicon Valley companies the UK wants to have headquartered here post-Brexit.

Hands up if you really think the UK Government is going to risk either packing up, closing down their London offices and setting up shop in Paris or Berlin.

So the language has changed, the threat seems more vehement, but Google and Facebook know this is all hot air designed to appeal to voters rather than threaten shareholders.

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