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Amazon to begin booking UK sales in the UK and will pay corporation tax
http://www.theguardian.com/technology/2015/may/23/amazon-to-begin-paying-corporation-tax-on-uk-retail-sales
This is to avoid George Osborne's punitive tax of 25% on companies seen to be artificially diverting profits to lower its tax obligations. It will be interesting to see how much is raised by companies switching where they book their sales.
This is to avoid George Osborne's punitive tax of 25% on companies seen to be artificially diverting profits to lower its tax obligations. It will be interesting to see how much is raised by companies switching where they book their sales.
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Let's just hope some of the other organisations who employ similar tricks follow suit.
I expect to see Margaret Hodge lambasting them for this shortly.
Still a hypocrite though.
He announced it in Dec2014 saying he'd bring it in Apr15, but i can't find out if it is in force yet. Also Amazon has NEVER made a profit, presumably through clever accounting and reinvestment, so Corp Tax bill for them will be £0.00
http://www.ibtimes.com/amazon-nearly-20-years-business-it-still-doesnt-make-money-investors-dont-seem-care-1513368.
Such as passing the cost on to the customer?
Then they will be less competitive and customers will go elsewhere. That's how a free market works and up to now Amazon has had an unfair advantage over UK businesses who do pay their taxes.
A good move from Osborne.
Which would explain Amazon's recent free postage increase, to £20 when almost everybody else does it free with no lower spending limit?
The truth is Amazon have got the market cornered, and now they're using their relative monopoly to their advantage...
It is in force. It was enacted in the Finance Act 2015 and takes effect for the 2015/2016 tax year and because of the way the taxable profit is calculated under the act, Amazon would have tax to pay.
I agree and they should never have been avoiding tax in the first place. Let's hope that other scally firms like Google follow suit.
Google probably won't, there are other reasons to locate in Ireland besides tax benefits. The Irish internet regulator tends to be slightly friendlier and more co-operative than other European regulators. They might decide the increased tax is worth it (or they might just find another dodge to get out paying it)/
Yes they have been claiming the cost of building factories against their profit, which might be allowed where they are tax resident.
But it isn't allowed under UK regulations, reinvestment is not a claimable item.
So if they want to trade in this country, they should pay tax in this country, under our rules.
Google earns a lot on advertising money in the UK. It either pays tax on that or they'll have to pay Osborne's 25% tax.
Google can take their pick but they will pay UK tax.
You genuinely think accountants haven't already thought up a million and one ways to get out of paying it? How cute...
Wouldn't surprise me if the government had deliberately left loopholes in, and Amazon were just doing this for publicity.
You don't get it do you?
The 25% tax comes in if these companies deliberately try to avoid paying UK tax on their UK profits.
They can think up two thousand ways to avoid paying UK tax on their UK profits. Then Osborne's 25% tax kicks in.
Five stars from me Weeman.
Pay your taxes and let us find a way so you pay as little as possible .
It's fairer. At the moment they get to "compete" with UK businesses and UK retail stores that have to pay UK tax and are put at a disadvantage, whereas Amazon can pick and choose where they want to pay it
Amazon will still be free to compete in other areas, like customer service (which is generally excellent) or free postage to win customers
Exploiting tax loopholes that bricks and mortar retailers such as HMV couldn't is one of the reasons Amazon managed to all but destroy the high street record shop, despite the fact contrary to media coverage 60% of music is still bought on CD and vinyl.
If they have to jack up prices to pay the taxes and thus create a fair playing field for high street record shops then good show I say.
How do you explain that practically every country in the world doesn't have high street record shops? It isn't because of Amazon in the slightest.
I get what the tax is supposed to do. But you're a complete mug if you think nobody's going to find a way around it...
I don't care how difficult or impossible it is in theory, they'll find a way. There's potentially a lot of money at stake, and in the case of the tech companies, the benefits of staying in Ireland are so comparatively great (especially since the British government is basically going full China/North Korea on tech issues at the moment) that they'll find a way.
It's like a never ending game of whack-a-mole, you will never win, and thinking you've won, just means you haven't noticed how badly you're losing...