Amazon has announced that it will pass on the cost of the UK’s new digital service tax to sellers in a move that risks the ire of the British government.

The e-commerce giant issued a note on Monday saying that, following discussions with the government over the measures, it was no longer prepared to absorb the costs of the tax.

As a result, the US tech giant plans to increase referral, storage, fulfilment and multichannel fulfilment fees by 2 per cent in the UK from next month.

The price hike is likely to be passed on to consumers, potentially making Amazon products less competitive at a time when its service is thriving.

Post expires at 9:10pm on Saturday February 6th, 2021