Amazon

[PeterGladstone]

As a dad am I allowed to make a comment about Amazon. I am appalled that mumsnet have allowed Amazon to partner with them when because of people like Amazon/Starbucks etc we are all paying more personal tax.

The fact is that all these companies (including the one I work for which is not in the spotlight) have a duty to maximise profits for shareholders. They also need to comply with the laws of the land....and that they are doing.

I agree it is morally wrong - but legally it isn't. The thing that needs to change is the law on taxation and that will not be simple. Lobbying your MP is probably going to be more effective in the long run.

I thought about ceasing to use Amazon, but I won't because generally it provides a good service and makes my life easier. Starbucks recent promise to pay a bit more tax is a sop to customers...they will offset it / reclaim it from their workers' bonuses.

The only way to change these practices is to change the law (and various taxation treaties).

Because I'm paying more personal tax I need retailers like Amazon to give me cheap deals on purchases!!! Rarely use expensive coffee shops anyway. Like the PP, I'd rather the law changed than start random witch-hunts persecuting companies that are operating legally.

As a dad am I allowed to make a comment about Amazon
of course you are.

The main raison d'etre of MN is to help make parents' lives easier, rather than to be political. If there's a groundswell saying they should campaign about something, then it happens. I am personally trying to use retailers other than Amazon because I don't care for their tax avoidance (and they're not always the cheapest) but they aren't doing anything illegal and they're so bloody convenient that it may be hard to garner much support on this one.

Ordinary people manage their affairs in such a way so to minimise inheritance tax for example. So, as long as it is legal, I'm not going to go on a soap box rant simply because Amazon has better accountants than I :)
Plus, I about 90% of my online shopping is with Amazon because they usually have the best prices so I be a bit hypocrite to complain about their management practices.

Ordinary people can't use tax havens though - big companies and mega rich have access to wangles that normal people can't use. I think that's where it starts to get questionable.

I exploit every loophole going to pay as little tax as possible.

Would you like me to leave now?

It is the fault of poor legislators that such loopholes exist, hopefully they will soon be closed. In the mean time I will buy from Amazon knowing they employ a lot of UK people and that I pay more than my share to charities such as hospices and shelter that wouldn't need to be charities if our taxes supported them rather than wars.

I,m with the op. The little people are being squeezed due to the tax avoidance of the big corporates. I get taxed on the money i make though i can ii afford it. Rich companies making profits out of struggling consumers should pay tax on their profits otherwise we are just subsidising them. It may be legal but it is immoral and the law should be changed. And no, mumsnet should not partner with such an exploitative outfit..

Of course loopholes shouldn't exist. And of course normal people don't pay more tax than they need to - but there isn't that much they can do legally.

Not this again.

Amazon is NOT a UK company. Amazon.co.uk is the TRADING NAME of Amazon EU SARL which is a Luxembourg based company.

Amazon actually do sell to all over Europe. Try amazon.fr, amazon.de even amazon.it. They are all areas which Amazon SARL sell to.

This is actually the entire point of the EU single market. A company can (and should) only have one corporate base within the EU. And from there can sell to any EU country they please. All 27 if they wanted to. They are legally free to move corporate bases just like us people can freely move to any EU country. And crucially they are taxed on their profits from that one base. It doesn't matter which country they sell most to, nor where most of it's employees are. All that matters is where their corporate HQ is based.

The point is that Amazon is operating exactly as the politician's designed the system to work. Is anyone seriously suggesting Amazon was wrong to set up in this way? If you are the CEO of Amazon US and want to expand to Europe. Where do you base your company HQ? The UK which would charge you 24% or Luxembourg who will give you a special deal which is suspected to be close to 0%.

The only way the UK government can stop this from happening is to leave the EU with all the problems that will bring. Personally I'd be more in favour for the other EU countries to line up together and tell Luxembourg to stop it or boot them out.

Maybe they've changed but one of the things they were doing to avoid tax was shipping from the Channel Islands - which (correct me if I'm wrong) are not part of the EU.

Leaving the EU would have many downsides - as you say, the countries within the EU need to sort out this taxation business if its to operate properly as a single market. And find ways to tighten up tax haven loopholes.

"The islands are not part of the European Union, but are part of the Customs Territory of the European Community by virtue of Protocol Three to the Treaty on European Union." source

So in other words they can trade freely within Europe just like the rest of us can. But I think there are restrictions on them moving to other EU states unlike any of us.

The 'tax avoidance' you mention was basically a rule specifically brought in by the government in years gone by called 'low value consignment relief (LVCR)'. I think it's unfair to criticise a company for using a rule exactly as it is designed because the politician's didn't think it would be so popular? Put another way. The government have introduced ISA's to encourage us to save. Are we then tax avoiders if more people use ISA's than the government estimated?

And are the customers equally culpable? I mean I bought CD's, batteries and even contact lenses from channel island based companies because primarily they were cheaper. Was I immorally avoiding tax in doing so?

I just cant get worked up over Amazon using a tax loophole. How many self employed people maximise their books to pay as little tax as possible?

They employ a lot of people, keep couriers in business and provide a great service. It not like they are taking from the countries "pot" is it.

I'm not worked up about it. Just don't think I'm going to automatically give them my business if there's alternatives any more merely because its easy.

It not like they are taking from the countries "pot" is it.
Dunno - maybe they aren't ...but every time we choose to buy a foreign product or use a foreign company we're more likely to be taking from our country's pot than if we use a UK company. Some foreign companies contribute massively to our economy - others less so. Do whatever fits with your pocket and your ethics.

TBH I'd rather we all paid less tax and had a smaller public sector (the two things are inextricably linked). But given the pain of reducing the latter, someone's got to pay tax, haven't they?

I agree with niceguy2 the government should be working with Luxembourg to stop this happening. They did close down the channel islands loophole, though I think it has moved elsewhere. I don't think HMRC has got to grips with the virtual economy yet and this needs to be addressed.
I do find Starbucks suggestion of a voluntary donation utterly ridiculous; they should calculate their profits rationally and HMRC should enforce this. If they can take jaffa cakes to court why not Starbucks.

I agree with niceguy2 the government should be working with Luxembourg to stop this happening. They did close down the channel islands loophole, though I think it has moved elsewhere. I don't think HMRC has got to grips with the virtual economy yet and this needs to be addressed.
I do find Starbucks suggestion of a voluntary donation utterly ridiculous; they should calculate their profits rationally and HMRC should enforce this. If they can take jaffa cakes to court why not Starbucks.

If they can take jaffa cakes to court why not Starbucks.
because starbucks is not doing anything illegal.

My point is that the jaffa cakes issue went to court to establish how they should be treated for tax purposes. I believe this is reasonably common when new issues arise in relation to tax. I don't see why something similar couldn't be done to establish whether Starbucks gave calculated their profit in a reasonable way or if they have distorted it solely in order to avoid tax.

Different thing. The jaffa cakes was to get a legal ruling on 'is it a cake or a biscuit'. In the case of starbucks and amazon I don't think there is any 'new issue' -other than the scale - I don't think there's any suggestion of illegality.

I just find it had to believe that Starbucks calculated profit gives a true and far representation. Obviously there's a lot. of information here that I don't know about but in general I think HMRC should be pursuing these issues harder and faster and if it is all currently legal finding ways to close tge loopholes.

hard to believe even