Google has updated its free gift card gift tax policy to clarify that it will no longer deduct the gift tax from the total purchase price.
Google has confirmed the changes in a blog post today, explaining that the policy has been revised to remove a “misleading interpretation” of the policy.
“We’re updating the Free Gift Card Policy to clarify what the tax rate for gift cards is and to help you understand the effect it has on your purchasing power,” Google wrote.
“The policy’s revised wording is more accurate and clearer, and clarifies that the gift card tax will be applied to the entire purchase price, rather than the purchase price plus the gift amount, and that we will no more deduct the tax from your purchase price than you would deduct from a taxable purchase.”
“We’ve also added the new gift tax calculator to help simplify things for you.”
Free gift cards are offered by Google to customers to make shopping easier.
The policy change comes after a spate of new data released by Google revealed that the company received over £1.7bn in gift card fraud last year.
Google also revealed that it has been collecting data from customers, to help better understand the impact that the rise in gift cards has had on their spending habits.
In March, Google’s head of gift card analytics, Steve Hsieh, told the BBC that the “Gift Card Fraud Report” shows that over the past 12 months, Google has seen an average of 8,000 new cases of card fraud each day.
“That’s an increase of 5,000 per day since March 2017,” he said.
“This means that the number of fraud cases has more than doubled.”
According to the BBC, the number one gift card scam is from people using fake gift cards and other fraudulent activity, which is why Google has been adding more anti-spam measures to the products it offers.
Google is also changing its policy so that it can no longer claim the tax deduction as a tax benefit for purchases made with the gift cards.
Google says the policy change is not meant to penalise anyone, and is designed to help people make smarter decisions about what they buy.
“In this case, we don’t know how much gift card-related fraud there is in the UK, and therefore we don.
But we also don’t want to make it harder for people to make smart purchases,” Hsieb said.