Amazon won’t reveal total UK tax bill after sales of £7bn and a £1.3m rebate
Amazon has refused to reveal how much it paid in total UK tax last year after it emerged it actually got a rebate of £1.3million.
The online giant, which three years ago pledged to stop using a controversial tax avoidance scheme, admitted it had paid just £7million in corporation tax for its largest UK arm despite the retailers total UK sales topping £7billion in 2016.
Amazon UK Services Limited, which employs 14,000 warehouse and logistics staff, paid up after declaring £24million in profits on sales of £1.5billion.
But rules around tax credits for shares given to staff meant it ended up getting £1.3million back from the taxman.
Amazon’s soaring share price last week briefly made founder Jeff Bezos the world’s richest man, just ahead of Microsoft’s Bill Gates, with £70billion.
Bezos’ company does not publish the amount of UK tax paid and refused a Mirror request to reveal the amount.
Tax campaigner Professor Richard Murphy, from City, University of London, has criticised the lack of transparency.
He said: “Amazon is still not telling us the truth about its sales, profits and tax due in the UK. We can only see the results for its warehousing operation and not what it really makes out of selling to us.
“That’s not good enough in a world where tax transparency is key to customer and investor confidence.
“It’s time for Amazon to adopt the new global approach to tax accounting that’s called country-by-country reporting.
“This would make it report its sales, profits and tax for every country in the world where it operated. Then we’d really know what it was up to and whether it really had some thing to hide.”
Company filings in the US showed the record £7billion in UK revenue. In the past, most of that money was received in Luxembourg, a well-known tax haven. But Amazon faced accusations of tax avoidance and pledged to stop. For the past two years, Amazon has sold its products to British shoppers through a new UK branch of the Luxembourg company – and it insists it paid full UK corporation tax on profits.
Three other UK Amazon companies, Amazon Data Services UK Limited, Amazon Web Services UK Limited and Amazon Online UK Limited, earned £131million in turnover in 2016 then paid £1.7million in corporation tax on £7.4million profits.
Former Chancellor George Osborne brought in a “Google tax” two years ago on companies artificially moving sales and profits offshore. Amazon’s Luxembourg operations have been under investigation by the European Commission since 2014. If the EC finds it amounts to illegal state aid, it could face a large tax bill.
Amazon said: “We pay all taxes required in the UK and every country where we operate. Corporation tax is based on profits, not revenues, and our profits have remained low given retail is a highly competitive, low-margin business and our continued heavy investment.
“We’ve invested over £6.4billion in the UK since 2010, including opening a new head office in London and development centres in Cambridge and London, and created 5,000 permanent jobs in research and development, our head office, customer service and fulfilment centres.”
