After Google, Amazon to be grilled on UK tax presence
21 May 2013
Posted by: Author: Irish Times
Internet retailer has paid about $9 million in income tax on more than $23 billion of sales to British clients over past six years,
Internet retailer Amazon. com will be called back to the UK parliament to clarify how its activities justify its low corporate income tax bill in the UK, two MPs said yesterday.
Amazon will follow search giant Google, which attended another grilling by parliament’s public affairs committee (PAC) over its tax affairs on Thursday.
Over the past six years, Amazon has paid about $9 million in income tax on over $23 billion of sales to British clients, because it says it operates a single European business out of Luxembourg, rather than a multinational structure of independent subsidiaries in different countries.
However, Reuters has uncovered evidence from the company’s own statements, job advertisements, statements from three suppliers and five former employees, as well as the profiles of over 140 staff on networking website LinkedIn, which suggests the UK unit has a high degree of autonomy, with local managers deciding on many aspects of its business.
The information, collected during a three-month investigation, suggests that while Amazon depicts itself as a virtual business, its structure may not be so different from its bricks-and-mortar rivals.
"The basic business model wasn’t very different to a mail order company in the 1970s or 80s,” said Mark Riley, a former business development manager at Amazon.co.uk.
Amazon declined to answer questions about its UK business. – Reuters