---- Amazon avoids paying tax in the UK and other EU countries
nonstop - 10:10 pm on Dec 13, 2012 (gmt 0)
half of adults in the UK gave to charity last year (28.4 million adults) so I guess some people have a conscience :)
If corporation tax in the UK isn't effective because it's being 'priced out' by other EU countries... then change it.
The problem is Amazon pays less than 5.4% corporation tax on it's whole european profits by being in Luxemburg
Amazon's Luxembourg arrangements have helped it pay an average tax rate of 5.3 percent on overseas income over the past five years, less than a quarter of the average rate across its major foreign markets.
this is morally wrong.....meanwhile the NHS is getting stripped back so that the government can cover this shortfall in income.
it's not just europe tho:
Had Amazon remitted all that to the United States and then paid the headline U.S. corporate income tax rate on it, the firm would have incurred taxes of more than $700 million. But it has not and the deal has allowed Amazon's Luxembourg unit to accrue tax-free cash worth more than $2 billion.
As the cash built up in Amazon Europe Holding Technologies, the firm started to lend to Amazon EU SARL. Besides funding international expansion, this has generated up to 45 million euros a year in interest since 2005 - all untaxed.
and it looks like the IRS in the USA is looking for a big chunk of this cash back:
Amazon disclosed in October 2011 that the IRS wanted $1.5 billion in unpaid taxes. It has declined to say exactly what transactions the charge relates to but said it was linked to "transfer pricing with our foreign subsidiaries" over a seven-year period from 2005.
this is tax avoidance on a grand scale by the company with a "smile" on the box.
The governments response is that they are spending £900 million of tackling tax avoidance, if these companies come up in the news again that they haven't paid any tax then the government will have egg on its face so im guessing they wont get away with it forever and Amazon will have the change it's easy money business model :)