Effect of Digital Service Data-based Study on the UK’s DST and Google

With the expansion of the digital economy, European countries (e.g., the UK) have proposed and implemented the Digital Service Tax (DST in the following parts) to giant digital service companies (e.g., Google) started in 2020. It is necessary to investigate whether the DST costs large from a company’s revenue, and if the DST will keep rising in the future. This work is designed to draw an outlook to address the two questions. On this basis, a data-based case study is carried out of two major entities in DST issues: the UK as the tax collector and Google as the taxpayer. The data of Google’s total revenues and advertising revenues are collected from 2018 to 2020 for estimation, and the UK’s DST rate of 2% is used. To process the data, Microsoft Excel and CORREL functions are applied to calculate data and make a chart based on the analysis. According to the result, this work found a tiny percent of DST compared to Google's revenue. The amount of DST may follow an increasing trend while the percent of DST in total revenue decreases and the percent of DST in advertising revenue remains unchanged. The difference between the two percentages is due to the decreased percent of advertising revenue in each year’s total revenue. Based on the analysis, the DST would not significantly affect a company like Google who provides digital services. Nevertheless, DST may keep rising in its actual amount.