The UK Government has denied that it is planning a special tax on Google. See story:http://www.dailymail.co.uk/news/arti...ministers.html

Google avoids paying UK tax on Google Adwords by operating via a Dublin based subsidiary. UK advertisers of Yahoo search marketing are charged 15% VAT as their operations are based in London. Since the Daily Mail story broke a spokeswomen for the Department of Business has denied that there are any plans to target Google.
http://www.theregister.co.uk/2009/05...il_bbc_google/.

However, the UK Government is now running a £170 billion deficit. Tax avoidance operations such as those used by Google will obviously attract attention when other sources of government revenue are under pressure.


More...