Amazon’s Tax Bill

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Amazon’s UK sales last year, according to accounts the company filed in the US, were £4.3bn. Now I think writing figures in abbreviated form like that fools some people – so written in full that’s £4,300,000,000. I also read that they have paid just £2,400,000 in tax (£2.4m if you prefer) on those sales (that figure being based on the £449m of UK sales they’ve filed here in their accounts at Companies House). That means, unless I have got my sums hopelessly wrong, that Amazon paid a mere 0.056 pence in tax for every pound of sales they made here in the UK or, to put it another way, 1p for every £17.92!

According to some reports they also got a £2.5m government grant last year so if that’s true they achieved a net gain from UK plc of £100,000.

So while companies here in the UK shell out hundreds of millions of pounds on business rates for their property as well as corporation tax, Amazon run their European business from Luxembourg avoiding such costs.

I have no idea how tax laws work and anyway I’m sure Amazon aren’t breaking any of them but surely this can’t be right?