Amazon paid no corporate taxes in Europe last year as revenues skyrocketed
Amazon did not have to pay corporate tax in Europe last year despite a record turnover of 44 billion euros.
Amazon sells products to households in the UK and many European countries through Amazon EU Sarl. Despite the record amount achieved, there was a loss of 1.2 billion euros in the Luxembourg unit of Amazon, which means that it did not pay tax.
The Luxembourg unit takes care of sales for the United Kingdom, Spain, Germany, France, Poland, Sweden, the Netherlands and Italy.
If the Luxembourg unit were to make a profit at some point, it was given 56 million euros in tax credits to pay the tax bills.
I don’t mind paying taxes.
In fact, I gladly do it.
Until I find out I am paying more than Amazon.https: //t.co/lXuErPWvYv
– George Monbiot (@GeorgeMonbiot) May 4, 2021
The news was hailed as indicating that large multinational companies continued to avoid paying corporate tax.
The Fair Tax Foundation called the scale of tax evasion “mind-blowing”, saying:
In essence, we are seeing Amazon exponentially dominate the market across the globe with revenues that continue to be largely untaxed – allowing Amazon to unfairly undermine local businesses that take a more responsible approach.
In the UK, Amazon had a turnover of £ 13.73 billion in 2019, but only paid £ 293 million in tax. Additionally, in 2020, the company achieved $ 20 billion in revenue in the United States. According to the Institute on Taxation and Economic Policy, Amazon avoided paying $ 2.3 billion in taxes on this income.
Many large companies have their headquarters in Luxembourg. The country is ranked sixth in the world in the Corporate Tax Haven Index of the Tax Justice Network.
Nothing could better illustrate how our tax system is broken
Large multinationals are not paying their fair share as the building blocks of society collapse for lack of funding. This must change https://t.co/qcFi5Vx7Tz
– Caroline Lucas (@CarolineLucas) May 4, 2021
A minimum corporate tax
Joe Biden has proposed several global tax reforms, including a minimum global corporate tax rate. The United States is currently working with the OECD to try to reach an agreement.
France and Germany have supported a minimum tax rate of 21% on multinational companies. In contrast, the UK did not respond to the proposal, although opposition MPs urged it.
Today we learn that Amazon achieved a turnover of 44 billion euros in Europe in 2020 but paid no corporate taxes.
Our country should strongly support Biden’s plans to end it. It is appalling that Conservative ministers continue to refuse to do so.https: //t.co/QI7OJ3vwWv pic.twitter.com/abjdj6DqAe
– James Murray (@jamesmurray_ldn) May 4, 2021
This thread. All the words.
If we judge a society and a system by how they treat its less fortunate, free market capitalism in Britain is an absolute disaster.
This morning it was announced that Amazon has a European sales income of £ 38bn in 2020 but does not pay any corporate tax https://t.co/gT6C7LSQPf
– Samuel West 💙 (@exitthelemming) May 4, 2021
An Amazon spokesperson told the Guardian:
Amazon pays all required taxes in each country where we operate. Corporate tax is based on profits, not income, and our profits have remained low given our heavy investments and the fact that retail is a highly competitive, low-margin business.
We have invested well over 78 billion euros in Europe since 2010, and a large part of that investment is in infrastructure that creates thousands of new jobs, generates significant local tax revenues and supports European small businesses.
Last year we paid more corporate tax than Amazon.
The system is rigged.
Buy local if you can. Use independent companies. Buy with those who have the same ethics as you.https: //t.co/ope9BonVYl
– Roasted coffee (@RoastingHouseUK) May 4, 2021
Amazon’s defense is not incorrect; he makes relatively modest profits on huge sales. However, as the company continues to expand its monopoly on all forms of commerce, the real benefits are yet to come.
If it is not broken, Amazon will continue to envelop the entire market.