If you use Meta ads, that is Instagram or Facebook ads, in one of six named countries, then you will soon be subject to increased fees – due to a location service fee.
The six locations, named as the United Kingdom, Austria, France, Italy, Spain and Turkey, are all adding a Digital Services Tax to online platforms and programmes – with Meta passing this on to the user as a ‘location fee’.
The increase will be seen as an extra charge on top of ad spend, with the exact percentage depending on which location an ad is appearing in.
How Much Extra Can I Expect to Pay?
If you are in the United Kingdom, or are sharing ads with a UK audience, the percentage service tax is 2%. This sits at 3% in France, Italy and Spain, and 5% in Austria and Turkey.
Crucially, this added tax applies whether you are in the country itself or not. It doesn’t matter where you are as the user – what matters is where your ads are being shown. So, if you market to a global audience, you can expect to see this fee added to your charge bill.
Why is This Happening?
Location fees are nothing new – in fact, Meta has been subject to them for a while! However, where the platform used to soak in the fee itself, now it is passing it on to the user to help cover the costs.
In short, Meta is now looking to avoid paying the charges itself by passing those charges on to users. Never has it been so important to really consider the impact of your ad spend, where you are targeting on the geographical landscape, and why.
If you run a business or are looking to expand your profile in one of the 6 named countries, our advice is to compliment your ad spend with targeted follower and engagement packages, that ensure your content remains visible with a broad reach. Adding this growth strategy to your use of Meta ads will built loyalty and keep your brand at the top of users’ feeds.
