Wednesday, September 04, 2019

Amazon's UK Tax - “the square root of diddly-squat”.

Amazon’s annual filing at Companies House revealed that sales rose 18% to £2.3bn and pretax profits 4% to £75.4m for the division, which accounts for more than a quarter of the group’s UK sales. Amazon does not reveal profits or corporation tax payments for its entire UK operation, which would include its retail business as well as warehouses and logistics.

Amazon UK Services, the company’s warehouse and logistics operation that employs more than two-thirds of its 27,500-plus UK workforce, said its corporation tax contribution had risen by nearly £10m in the year to December 2018 from the £4.7m paid in 2017

Richard Murphy, professor of practice in international political economy at City, University of London, said: “If it wants us to believe it is paying the right amount of tax it has got to give enough information. No accounting number makes sense in isolation.” Murphy said he would expect Amazon to pay at least £100m in corporation tax alone at its UK business, assuming that it made profits at a similar rate to the group as a whole. “There is clearly an underpayment to explain,” he said, calling the payment by Amazon UK Services “the square root of diddly-squat”. Murphy said the company would be under pressure to publish more transparent accounts as it was becoming normal practice for companies to “reveal and explain” their tax bills.

It did not break this down to reveal the amount of corporation tax paid by its UK operation, which had total sales of $14.5bn (£10.9bn) last year, according to the group’s annual report.

Paul Monaghan, chief executive the Fair Tax Mark, which accredits businesses which are fair and transparent in the tax they pay, said: “The numbers sound like pennies down the back of the couch.” He said Amazon UK Services’ £14m UK current tax bill did not compare well with the Fair Tax Mark company Lush, which paid only about £1m less in tax on profits of £23.4m, less than a third of that made by the Amazon division.

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