The British government says it will force multi-national companies such as Google to pay more in tax.
Draft legislation Wednesday for the so-called Google Tax details a 25 percent tax on multinational corporations that tend to move profits generated in Britain to tax havens.
Managing director of tax advisory firm Taxand UK, Jonathan Hornby, told The Wall Street Journal the new tax may violate existing tax treaties. Specifically, he mentioned treaties that aim to protect multinational corporations from being taxed on the same profits in more than one country.
Only companies with revenues above $15.5 million would be subject to the proposed law.
Political analysts say the new British tax is viewed primarily as a way to target massive U.S.-based companies such as Amazon, Google and Facebook.
The U.S. ambassador to Britain, Mathew Barzun, said multinationals may be efficient managers of their tax liabilities but that they follow the law.