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Seriously. This weasel on radio 5 this morning just kept saying 'we pay all relevant taxes for the region' but wouldn't answer when Andrew Verity pressed 'yes, but that means tat you pay no tax in the ZuK because you have chosen to place Amazon.co.uk registered head office in Luxemborg.

If everyone phoned their mp about corporate tax evasion rather than mrs smiggins who is getting DLA when she looks fine we could pay off the deficit.

Hooray!

No. Seriously. Why don't we care about this?

That's outrageous.
I have seen their mahoosive warehouse in Swansea, they most def are based in the UK.

I know. Fuckers.

bloody hell! never knew that.

of course, they call it tax avoidance which is perfectly legal - grrr

What kind of tax are they not paying? Corporate ? They are presumably paying vat customs and other taxes so need to look at total tax take .

I am interested to know how you would solve this issue with Amazon?

They are a business and why can they not base their head office in another country if it makes financial sense? How can the british government tell companies this is not allowed?

There is also a bigger picture to consider, where is this money that they are not paying in tax? I suspect it will be going back into the company, expansion, staff etc which in turn benefits the uk economy. It is not as black and white as it appears imo.

I didnt know that. That is bad.

Might be worth posting this on CinnabarRed's tax thread:

www.mumsnet.com/Talk/politics/1154984-CinnabarReds-tax-thread

I heard this this morning too - but on Radio 4. The guy kept saying Ama -^zon^, which was annoying enough. And yes, he ducked the "you're in Luxembourg so you pay no tax you bastards" question too.

My understanding is that they don't have to add VAT to the products they're sending out (doesn't apply to their third party sellers) hence the cheaper prices. I can't see that they'd be paying Corporation Tax either if they're not based in the UK, but I could well be wrong.

Cinnabar good place to post. Also suspect they are doing what others like dell and apple do in basing themselves outside uk.

VAT appears on their invoices, doesn't it?

Yep - but depends on goods and place of supply. Sometimes it's another retailer selling via amazon

Amazon dispatch their CDs and DVDs from Jersey, I think, presumably this has a lower VAT regime for music and film? I think play.com did the same.

There is no VAT on books, only e-books.

No idea about everything else they sell like toys, think they all come within the UK for VAT.

Wow, just wow.

Tax avoided by business in the developing world is about the same as the Foreign Aid sent to those companies.

We're all being really screwed by them.

Sorry those countries, not companies.

http://www.mumsnet.com/Talk/_chat/1396755-I-cant-believe-these-people-are-claiming-benefits

I had similar thoughts this am.

The reasons are explained here

www.telegraph.co.uk/finance/comment/richardfletcher/8745314/Is-the-tax-trap-closing-on-Amazon-eBay-and-Google.html

The vat loophole of sending from jersey etc has already or is in the process of being closed I believe.

While we're on the subject of tax avoidance though - how many people here pay tradesmen etc cash in hand? Because that is proper tax evasion - not even avoidance....

Link re the vat loophole being closed:

www.independent.co.uk/news/uk/politics/budget-to-close-jerseys-hidden-mailorder-vat-loophole-2247764.html

Emmmmm apple and amazon are not from a 'developing country'.
And 'foreign aid' is a complex, often misunderstood term - depending on the giver.
Please don't mix the two.

I never pay tradesmen cash in hand.

My dh is self employed but in an industry where he couldn't ask for cash in hand, even if he was tempted to. Tonight we will be typing up invoices for all his employers.

I won't do it on principle.

I don't really understand They're avoiding paying 40% on their profits?

Amazon sell all over Europe though don't they?

Why should they choose the UK for their head office if it makes no difference to the service they give and they can make more profit from another country? They are a business, that's what businesses do.

If you have/had a window cleaner bibbity,how do/would you pay him/her?

Just asking.

Companies never pay 40% tax on their profits - corporation tax is at different rates and companies do lots of things to reduce tax bills!

Basically though Amazon's headquarters is on Luxembourg, so corporation tax is paid there. In the uk, Amazon are a service centre so don't pay corporation tax. They do however contribute via employee taxes, and a not insignificant employer National Insurance contribution.

This is the reason the govt lower corporation tax rates - to encourage businesses to leave headquarters in the uk. Is also why you hear about majorly successful companies like Barclays Bank paying effective tax rates of less than 5%.

Luxembourg dramatically cut corporation tax rates about 6-7 years ago I think to encourage companies to set up their headquarters there. Ireland did similarly actually.

Ah, thanks for the update re Jersey.

Paying cash to tradesmen is not of itself tax evasion - it just makes it easier for the tradesperson to commit tax evasion. I am not sure what, if any, responsibility the customer has to not pay in cash, or e.g. to only pay in cash if an invoice is given with a VAT registration number on it etc. Ultimately the tax evader is the tradesperson.

Though if they explicitly quote one price for cash and another price for cheques, I guess the customer might have some complicity that could lead to legal action - but I don't know.