Belfast Telegraph

Home News UK

Amazon in fresh corporation tax row

The UK arm of internet shopping giant Amazon paid corporation tax of less than £10 million last year despite generating sales of £4.3 billion.

Details of the American firm's tax contribution, which were revealed in filings at Companies House, sparked fresh controversy over its arrangements.

Consumers buy from the company's UK website and the items are delivered from British warehouses but these transactions are mostly with a company called Amazon EU Sarl in Luxembourg.

This allows the company to legitimately lower its tax bill. It is taxed at the lower rate in Luxembourg and then pays less corporation tax where the rate is higher in the UK.

Amazon says it follows the tax rules in all countries where it operates but Margaret Hodge, who chairs the Commons Public Accounts Committee, renewed her attack on the company, saying it should pay its fair share of tax.

She told the Guardian: "They are damaging British jobs. If you are a small bookshop in the high street you can never compete with their prices, because you pay taxes. Even for John Lewis their future is also threatened because they pay their taxes."

Ms Hodge said consumers should follow the case of Starbucks last year, when direct action persuaded the coffee chain to resume UK tax payments last year.

The results filing for shows that its corporation tax bill almost doubled to £9.7 million from £5.1 million a year earlier.

This reflected a sharp rise in p re-tax profits to £17.1 million as the UK business generated more money from the provision of fulfilment and corporate support services to other Amazon group undertakings.

Revenues were 40% higher at £449 million. Results from the US company at the end of January showed Amazon generated revenues from UK trading of 7.3 billion US dollars (£4.3 billion) last year.

The company said in a statement: " Amazon pays all applicable taxes in every jurisdiction that it operates within.

"Amazon EU serves tens of millions of customers and sellers throughout Europe from multiple consumer websites in a number of languages, dispatching products to all 28 countries in the EU.

"We have a single European headquarters in Luxembourg with hundreds of employees to manage this complex operation."


From Belfast Telegraph