Amazon: We paid £220m to HMRC
... but web firm still won’t reveal corporation tax bill (on sales of over £10billion)
AMAZON tried to quash long-running tax-dodging claims yesterday by revealing it paid £220million to the Treasury last year.
After years of criticism, the internet shopping giant released its first comprehensive account of its British sales and HMRC payments.
It said its retail division, web services arm and other divisions raked in £10.9billion in 2018.
But its move was unlikely to quell calls for more transparency after it refused to say how much it paid in corporation tax, which is levied on profits – something it also did not reveal.
Amazon said the £220million paid to the Treasury was about 2 per cent of its total sales.
It declared the biggest chunk was made up of employer taxes such as national insurance contributions followed by business rates, corporation tax and others such as stamp duty.
It had already revealed it paid £63million in business rates after MPs forced it to disclose the amount during a Parliamentary inquiry earlier this year.
The bill is considerably smaller than that for some British retailers as its uses out-of-town warehouses. The Mail has led calls to reform the business rates system, which charges high street retailers more than web firms which occupy less valuable buildings.
Amazon insisted its corporation tax for last year was brought lower because of how much it re-invested. And it stressed it played its part in funding public services, and said its UK investment created thousands of jobs.
The company said: ‘Focusing narrowly on one aspect of taxation, such as corporation tax, doesn’t tell the whole story.
‘This is particularly relevant for growing businesses like Amazon which have a high volume of sales but where operating profits remain relatively low due to price pressure.’ Amazon, founded by Jeff Bezos, the world’s richest man, has long insisted it pays revenue it is legally required to.
However, critics argue its complicated company structure – which goes via a parent in lowtax Luxembourg – makes it effectively impossible to see the true extent of UK operations.
It said the £625million spent on infrastructure and development helped boost the economy but cut its corporation tax bill as it entitled it to tax credits.
Its logistics arm, Amazon UK Services, will this week report revenues of £2.3billion for 2018. The division made a profit of £75.4million and paid £14million in tax, Amazon said. However, this is just one part of the American firm’s sprawling UK structure, which includes more than ten subsidiaries.
The company was widely criticised last year after it was revealed it paid just £4.6million in corporation tax on a turnover of £2billion in 2017 for Amazon UK services. The same year the company was ordered to pay £222million to Luxembourg by European regulators after it struck an illegal ‘sweetheart’ deal to pay four times less in tax than local rivals.
Such arrangements, which several big tech firms are accused of using, have prompted calls for levies on digital sales.
Amazon has more than 27,500 UK employees with warehouses and research hubs in London, Cambridge and Edinburgh.
It said it had invested more than £18billion in its British expansion since 2010.