It’s almost boring to report this: company does something entirely legal.
But at a time when we’re encouraged to consider the role of the EU in our national life, how governments are funded and the ethics of making money and paying tax, it is still newsworthy. Amazon paid a tiny amount of tax on a huge amount of sales in the UK last year.
According to reports, Amazon paid £11.9m in tax last year to the UK exchequer on recorded sales in the UK of some £5.3bn.
Although revenues grew 14%, with the UK representing about 10% of Amazon’s total sales, the UK arm Amazon.co.uk Limited posted profits of £34.4m to Companies House last week. Amazon’s operation uses a Luxembourg based subsidiary, Amazon EU Sarl, to account for most of its sales.
Of course, Amazon isn’t a massively profitable company (unlike eBay/PayPal) and this year it has changed its arrangements. But it’s unlikely that the UK government coffers will get much of a boost in any case. And, as is often noted by Amazon sellers, a bigger tax bill could mean a hike in selling fees.
And as we’ve often said on Tamebay: we can hardly blame any company for seeking to minimise their tax bill by any legal means. But even if Amazon haven’t broken the law, we do still perhaps wonder if the law isn’t broken.
7 Responses
The common media mistake of comparing sales by one company with the tax paid by another. Amazon co uk ltd does not have sales in the billions, nor do companies pay a turnover tax.
The limited company does work for the parent company and is taxed on the limited company profits. Rather like google uk gets taxed on google uk profits and not google Ireland turnover.
how much did the co pay in business rates?
how much income tax / nic’s did it generate
did it benefit from 60p per litre red diesel? NO
were any interest payments it made subsidised by QE?
other government hand-outs? MOST PROBABLY NOT
and otherwise it merely played the game by the rules laid down by HMG
those dissatisfied should take the issue up with their feckless mp
What do these figures mean?
Is £5.3bn overall payments handled by Amazon in that period?
Is it sales on only Amazon products?
Or is it Amazon sales plus fees on marketplace sellers?
I suspect it is the first in which case gross profit would be about ten percent of that.
Could an alternate headline be “Amazon pay £12 million tax on profits of £34million”?
a more partisan political view is this:
politicians love control / power
it is – they think – their game and their right
the digital world has removed much of their power in trade
they are envious & angry
the cost of them getting any power back will be borne by the electorate and consumers
don’t let them