HMRC Double Standards over Low Tax Amazon

Reports of an EU probe into Luxembourg’s tax subsidy for Amazon selling books across the EU, including in the UK. It’s said under a special agreement with Luxembourg Amazon only paid 1% of its European income to Luxembourg. The benefit for Luxembourg is it gets 1% of Amazon sales in the UK, and elsewhere in EU, as they are legally channelled through a Luxembourg company. But the UK buyer, UK seller, UK book and UK delivery never physically have anything to do with Luxembourg. Amazon benefits by paying virtually no tax because it says its UK sales legally belong in Luxembourg. It’s said US records show Amazon UK had a turnover last year of £4,300,000,000, but sales of only £449,000 were shown in the UK version. Doubtless Amazon is acting within the strict letter of the law. The fault seem to be with HMRC in not challenging Amazon, as the Parliamentary Public Account Committee has said. The impression is HMRC would be very quick to challenge a UK company if it did the same thing.

Eamon McNicholas
Tax Barrister, Accountant
 
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About Eamon McNicholas

Tax Barrister, Accountant www.EamonMcNicholas.com
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