Figures published last night by the PAC, show that Amazon sales from the UK amounted to £3.35bn in 2011, with £2.9bn made up from sales of the company’s UK website, www.amazon.co.uk, and the remainder from subsidiary LOVEFiLM and “other business activity” outside of the website.
The figures also showed the company made sales totalling £1.87bn in 2009 and £2.36bn in 2010.
The company has sparked outrage because despite having warehouses in the UK and employing 15,000 people, it drives all of its sales through Luxembourg – which has a lower rate of corporation tax.
Yup. And we’ve a double taxation treaty with Luxembourg, just as we do with 110 other countries, which says that merely having warehouses, a logistics chain, inside a country does not amount to a permanent establishment which gives rise to liability for corporation tax.
This isn’t a loophole, it’s not a dodge, it’s not tax avoidance. This is specifically written into the law. This is tax compliance.