Amazon’s lower tax bill branded ‘shameful and wrong’

3 Aug 18

Online retail giant Amazon’s UK tax bill reduced last year despite higher profits, which has been called “shameful and wrong” by a union head.

The US multinational company’s corporate tax bill almost halved to £4.5m last year, its accounts have revealed, just days after it posted a record profit of $2.5bn (£1.9bn) in the most recent quarter.

Tim Roache, general secretary of the GMB, the union for Amazon workers, said that these findings were a “complete disregard for UK taxpayers” and is taking money away from public services.

He called for the government to ‘sort out’ the tax system. 

“Services are at breaking point, the NHS, care services, education and local government struggling, we are told there’s no money but we’re letting the richest man in the world get away with this,” Roache said.

“It’s shameful and it’s wrong.”

“The government is letting down the entire country by not sorting out the tax system,” Roache said.

The pre-tax profits at Amazon’s UK business tripled from £24m in 2016 to £72m last year, figures reported by Amazon UK Services’ annual financial filings showed.

But the company paid less corporation tax in 2017. The tax bill almost halved from £7.4m in 2016 to £4.5m last year.

The union’s regional secretary Neil Derrick also said that if the company really wanted to help the country’s public services, they would pay their taxes “properly”.

The comment comes as the internet giant has secured a contract to sell supplies, from paper clips to bandages, to Yorkshire’s schools, social care providers and emergency services.

The five-year deal with Yorkshire Purchasing Organisation, a procurement body owned by local authorities, which helps to drive the cost of goods down by agreeing deals with suppliers.

Derrick said the deal was a “joke”. He said: “Instead, they’re trying to make a few million quid from our cash-strapped councils.”

GMB is a general union with more than 630,000 members working in different parts of the UK economy.

A spokesperson for Amazon UK said: “We pay all taxed required in the UK and every country where we operate.

The company reduced its tax liability by providing shares as awards to all permanent Amazon employees, which are deducted under standard UK tax rules, a spokesman said.

The UK’s warehouse and logistics staff and management saw a bumper £125m pay out from the company share scheme, as a result of the company’s rising share price. The share has surged 84% in the last two years.

“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,” the spokesperson said.

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