Amazon under fire after paying just £293m in UK tax on revenues of £14bn

Ecommerce

The world’s largest retailer paid just £293 million in UK tax last year, despite bringing in revenues of almost £14 billion.

Amazon’s tax payment represented a 33.2 per cent increase on its £220 million payment in 2018, with Amazon stating its corporation tax payment this year was reduced as a result of increased capital spending, as well as costs relating to research and development.

READ MORE: UK government denies it plans to scrap £500m ‘Amazon Tax’

The group holds its European base in Luxembourg, where all its incomes from markets across the bloc are combined and taxed.

In September last year it was reported Amazon Europe received a €241 million tax credit in 2018, despite growing efforts from European governments to force the retailer to pay more tax.

Amazon defended its tax payment, claiming it contributed £1.147 billon in “total tax” from its UK operations last year, although the majority of this was from indirect taxes such as national insurance contributions, business rates and stamp duty.

In August this year Amazon announced its plans to side-step the UK government’s ‘Amazon Tax’ by passing on the proposed levy to its sellers by raising seller fees by two per cent.

Amazon added it has now directly invested more than £23 billon into its UK operations since 2010.

“The UK has now become one of Amazon’s largest global hubs for talent and this year we announced plans to create 10,000 new jobs in the country by the end of 2020, ,” Amazon said in a statement.

“We pay all taxes required in the UK and every country where we operate, and focusing on one small piece does not provide a full picture of Amazon’s overall contribution to the UK. Corporation tax is based on profits, not revenues, and our profits have remained low given retail is a highly competitive, low-margin business and we continue to invest heavily.”

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2 Comments. Leave new

  • Are amazon unique in supposed to be paying tax on revenue instead of profit, like all other businesses?

    Or is it another case of lazy copy/paste journalism looking for easy clicks?

    Reply
  • That’s not actually outrageous. Sales were 14 billion. Assume they earned 10% net profit before tax, say 1.4 billion.
    Rounding up, if corporation tax was 20% that equals 280 million pounds in tax. As against 293 million actually paid.

    Reply

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