>Those companies will just raise their prices to cover the tax
How exactly will Facebook raise prices in a way that it will hit the average consumer?
How exactly will Facebook raise prices in a way that it will hit the average consumer?
The average consumer is also a worker and depends on an employer that will be paying higher advertising costs for the same benefit.
When something has near zero marginal cost, it is all just about demand. The only scarcity is caused from other bidders.
Why should a country send %X margin on all of their consumer products overseas (via ad costs) to someone who is selling their own citizens' content and capturing the users/locking them in with network effects? There is a lot of innovation at Facebook et. al., but they get a massively outsized portion of the network's value when you compare what they put in vs. what users are putting in.
Where it could hurt would be a service that can barely break even using ad revenue and goes under as a result. But for big corps with network-effect lock-in in their segment, it seems like a net win for any country that does this.
Facebook could also raise the reserve price for auctions for UK ads.