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Amazon has always been skilled when it comes to avoiding the tax man, but now tides are turning. Reuters reports that France is demanding £159 million in tax payments for a start.
France is claiming that the online retailer owes £159 million in back taxes, interest and penalties in relation to, says Reuters, “the allocation of income between foreign jurisdictions”. It’s the first of a series of such claims that look set to be levelled at Amazon — and other US-based retailers — as countries in the EU wise up to the tax tricks.
Amazon keeps its European tax bills low by channelling income through Luxembourg, which offers tax breaks to foreign companies which base themselves there. In its eyes, it’s done nothing wrong — which is why the online retailer plans to fight the claim “in court if necessary”, according to Reuters. For once, a trial that isn’t about rectangles. [Reuters]
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Good for France, The EU needs to work together a bit to avoid internet companies running rings around them.
Great news for France, I hope that the UK follows suit quickly.
If these big companys paid their taxes we’d all be better off.
The trouble is it’s the Chancellor of the Exchequer and he’s as clueless as the people that advise him. (The blind leading the blind suits this I think)
These accountants and lawyers make an awful lot of money from finding loopholes in the system. Starbucks channel all their money through Ireland so they don’t have to pay corporation tax. The trouble is the Government’s excuse normally is that businesses won’t come to the UK if this country get’s tougher on tax.
Would there be any need to be tougher on tax if the government were better at stopping tax avoidance?
I know it’s not as easy as it sounds, i.e. just tax them what is due. And I know that they spend a lot of money on very clever accountant so they don’t have to pay the tax, but it just rubs me the wrong way, I have to pay tax so why don’t they.
They do pay tax, they just pay less of it because they have set their companies up so that the main revenue stream goes to the Luxembourg based Amazon rather than the UK based Amazon. Even Nissan do this and they “manufacture” in this country.
I too would prefer them to get it sorted and it is possible to change the tax laws but tax is complicated and you can’t simply change one aspect without it impacting on the others.
The Chancellor of the Exchequer is not as clueless as he seems. His family, like many MPs and Lords use havens to hide their money. Check out their largest donor, Lord Ashcroft and his many oversees dodgy dealings.
If anything the UK has blocked any and all tax reform in relation to overseas tax havens given 1/3+ are in British Overseas Territories.
Its almost as if those in charge want this to be the norm and the act MPs put on yesterday was just for show.
Frankly if US Starbucks does not like paying fair tax on profits made in the UK they can F off back to the US, there are plenty of UK owned coffee chains that will benefit and fill the gap.
Lets face it they are not cheap or unique, so Startbucks don’t let the door hit you in the arse when you leave
The biggest companies will always bend the most rules and everyone else will suffer as a result. If the government wasn’t so supportive of all it’s tax avoiding old schoolmates they might, you know, do something about it.
Well for those of us not blinded by nonsensical inverted snobbery and bitterness, this has been going on for years and relates to international tax so it isn’t a simple as someone flicking a switch and fixing it all.
Non pleb.
Given the UK has been blocking international tax reform as 1/3 of havens are British Overseas Territory he has a point.
Do you think the party which biggest donor is Lord Ashcorft is going to reform tax laws then you are blind. Its where he, Osbourne, Cameron and many other MPs and Lords have money hidden. Lord Ashcroft was meant to become domicile when he was made a Lord but he didn’t bother and no one did anything about it, in fact the Tories keep giving him jobs / posts.
You do understand that there are almost as millionaires in the leadership of Labour, the Lib Dems and the Unions (seriously check out the personal wealth of the majority of Union leaders, it is staggering!) as there are in the Conservatives, the latter are just not deceiful enough to hide it. It is an absolute nonsense to suggest that the Tories are the people responsible for what is going on to help their friends, This has been going on for years, including under the previous labour government. I doubt any party has the genuine desire or ability to effectively reform the tax laws because they all benefit from it.
I have no affinity to any of them but I fail to see why someone having money is cause to question their motives and attack them ability to do a job. It would be like saying I don’t want a poor person to have the job because they wouldn’t know what to do with all the money and would just take it all for themselves.
I do not questions a persons motives based on their money.
I question their motives based on their actions. Osborne and Cameron’s family wealth is off shored, thats fact. Osborne has added more loop holes to allow for avoidance and negotiated deals with the Swiss that lest avoiders pay a fine and remain secret.
I do understand Labour is also populated with millionaires, but unfortunately they are not in government had have little power at the moment. When they were in power they really do better.
At least Labour was not reducing Tax Inspectors, who each generate many times their own income for HMRC. Why do that, if I was in a business where I fired profitable sales people then I wouldn’t be in that business much longer when profits tanked, in this case tax receipts.
Hate to break it to you but the notion that any party does ‘better’ in power is purely subjective not fact – in your opinion they do better, in other people’s opinion their time in power was naught but screwing over the middle class and handing out their hard earned cash to people who do nothing other than spew out kids and filth and are housed free of charge for the privilege perpetuating a society in which underachievers are excused and applauded and in which everyone is a victim, unless they happen to have money, whether through hard work or inheritance in which case they become a target. Much in the same way that in some people’s opinions the Lib Dems are apparently a viable political party.
Irrespective of that, no party would close the loopholes because they benefit from them. But if the government was a business, it would’ve folded many moons ago and most government deparments wouldn’t exist because they are sinfully ineffective and inefficient. It isn’t a business and no credible business person would ever take it on which is why we have ingrates and buffoons across all benches in parliament.
Where are these taxes owed though? If it’s the Warehouse side of things and not retail then it could have a bad effect and Amazon will just not create jobs here and that would be even worse.
Amazon will have to have slightly bigger profit margins to cover the taxes which will mean that consumers will have to pay a bit more. On the flip-side it will mean they aren’t squashing out high street retailer who at the moment can’t compete.
the problem is if you charge people large amounts of tax then they will avoid it anyway they can. and one way will be to leave. this happened in the past with many businesses and is currently happening in France as the entrepreneurs are fleeing to the UK where rules are easier and taxes are lower to set up business.
if Corp tax was lower it would become easier for companies to pay it and not worth them trying to avoid it. but when anyone in the word can make things cheaper you have to have a world wide response to this rather than a country by country response. basically if every one charged the same tax then it creates a level playing field that stops the problem.
you work out how to get every country to do this and one Nobel Prize for finance is yours!
This is pure bull propagated by media owned by billionaires.
1. These companies cannot move abroad, they are foreign companies with UK arms. They could stop serving the UK, which would be good, and they would lose million in profits. Other companies who pay tax would then benefit from the gap left in the market.
2. Its a joke French entrepreneurs are coming the the UK. Their business still operates in France and is subject to French law. Its something Cameron said to piss off the French left before they won the election, something he should not have involved himself in.
3. Many corporations pay 1% – 3% tax even though its at 23% falling to 22% I believe. Lowering it to 15% would not make them pay the tax when they could still avoid it and save 12%.
4. We do not have a level playing field and will not as long as havens exist. A UK company paying the full corporation tax is at a massive disadvantage when compared to one based in a haven as they cannot offer low prices. This is why Amazon has built a monopoly which is bad for everyone.
5. Hope you realise you are paying the wages of Amazon / Starbucks workers through them getting tax credits as they are not paid enough so we the tax payer tops up their wage.
Trust me these mega corps have no intention of leaving, the CEO’s would have to find the revenue shortfall from another market to keep the shareholders happy. So they put there prices up?, you shop somewhere else!, the simple fact is they have been able to get away with it for too long. Our local stores can’t compete, as recent events have shown
Exactly they should just leave and then our own companies would fair better.