Online retail giant Amazon lowered its corporation tax bill in the UK by more than half in 2016, this is despite increasing its turnover in the same period. In 2016 Amazon paid a UK corporation tax bill of £7.4 million, but this figures pales when you consider that they paid a total of £15.8 million in corporation tax in 2015. The company has received a great deal of flak over its perceived lack of transparency over regarding their revenue streams and how much tax they are contributing to HMRC over the last year or two and these figures are not likely to lessen the criticism.
Increase In Turnover At Amazon
Amazon UK Services (who run the warehouse operations and package and distribute all the products) reported that they increased turnover from £946 in 2015 to £1.46 billion in 2016, an increase of over 50%. Their overall tax figures for each year are apparently disclosed to HMRC but are not available for public consumption, which does give the impression that people have something to hide whether they actually do or not.
When asked about the reduction in their UK corporation tax bill over the aforementioned period an Amazon spokesperson said that: “We pay all taxes required in the UK and every country where we operate. Corporation tax is based on profits, not revenues, and our profits have remained low given retail is a highly competitive, low margin business and our continued heavy investment.”
Paying Their Fair Share Of Taxes
But not everyone accept this assertion and believe that they are not paying their fair share of taxes. Liberal Democrat leader Vince Cable condemned the company saying: “This is yet another example of how companies are taking the government for a ride and we’re going to have to look at the way we charge these companies tax. We need to shift the system so that we tax real activity and the business they do here.”
The above quotes have been taken from an article in Accountancy Age and you can read the full article by going to the following link: Amazon Halves Its Corporation Tax Bill . And if you need any help or advice regarding tax and/or your tax bill please give our offices a call on 028 3752 2909 and we will glad to be of service.