Row as Amazon fights £221m fine over unpaid tax
INTERNET retail giant Amazon was branded “arrogant” last night after it emerged it is appealing against a £221million fine over unpaid taxes.
At the same time new figures show Amazon UK’s British tax bill has fallen to its lowest level in five years – despite profits soaring.
The fine levied by the European Commission came after it found Amazon was given illegal tax benefits by Luxembourg. The company was ordered to pay the money last year.
Amazon yesterday confirmed it had paid but said it was appealing through the European courts.
Tax experts last night criticised the company’s decision and said Amazon had played a role in the “destruction” of the British high street. Corporate tax expert Phoebe Griffits, of KIS Finance, said: “Amazon’s decision to challenge the commission’s ruling is another clear example of the retail giant’s arrogant stance when it comes to paying their dues.”
She accused Amazon of “playing the system” to minimise its UK tax liabilities. “While they are quick to point out that they have complied with their legal obligations, other retailers of similar sizes in the UK are paying up to 20 times the amount of tax,” she said. “If this inequality is allowed to continue the future of the UK high street remains at risk.”
Alex Schlagman, founder of SaveTheHighStreet.org, said: “We have to find a way of levelling the playing field as the system is currently set up for Amazon to benefit. Amazon are behaving in a way to optimise their own gain and it has a negative knockon effect. The failure of the high street impacts everyone.”
Amazon UK’s corporate tax bill fell by £2.8million last year despite pre-tax profits nearly trebling. Its UK bill was £4.6million, down from £7.4million the year before, Amazon UK Services accounts show.
But the company paid only £1.7million in tax after deferring £2.9million. That was despite pre-tax profits jumping to £72.4million from £24.3million in 2016, according to figures filed at Companies House.
The lower tax bill was partly due to Amazon making share payments to thousands of staff. Jolyon Maugham, QC, a barrister specialising in tax, said: “The tax avoidance of Amazon is one of the factors that contributes to the destruction of the high street. Although Amazon can be cheap and effective for consumers it carries a cost for lost jobs and a shortfall in tax revenues with which to fund vital public services like the NHS.”
Mr Maugham, director of the Good Law Project, said other jurisdictions across Europe had been “more aggressive” than the UK in pursuing companies like Amazon.
Amazon said: “We pay all taxes required in the UK. We have invested over £9.3billion here since 2010.
“This year we plan to create 2,500 permanent jobs to bring our workforce in the UK to over 27,500.” Company accused of being ‘arrogant’