Amazon, the largest global online retailer, is the subject of an investigation conducted by the UK tax authorities, on suspicion of tax evasion. Amazon.co.uk generated last year sales of more than 4 billion euros in the UK, but did not pay tax on profit, informs The Guardian. The investigation of operations in Britain, where one of four books is sold by Amazon, refers to a time when conducting business in the United Kingdom was transferred to a company in Luxembourg, namely in 2006. All payments for books, DVDs and other goods were directed to Luxembourg, while the UK business was just a “delivery organization”.
According to figures from 2010, Amazon employed at the office in Luxembourg only 134 people, but has generated turnover of 7.5 billion euros. In the same year, in the UK were employed 2,265 people and registered a turnover of only 178 million euros. That year, sales in the United Kingdom were between 2.8 and 3.8 billion euros.
In the last three years, Amazon has generated sales of between 9.2 and 12.5 billion euros in the UK without paying tax on profits from these sales, the report of the financial market regulatory authority in the United States shows. According to the Guardian, the taxable income would be about 320-440 million euros. However, during 2003-2011, the UK registered company paid taxes totaling 3.6 million euros, of which 2.3 million euros were paid in 2011.
The Guardian asked the representatives of Amazon why the company has not paid any tax for the approximately 3.5 billion euros it takes from economy. The company declined to respond on its fiscal problems, but sent an e-mail that reads: “Amazon serves millions of customers and dealers across Europe and sends products to all 27 EU countries. We have the European headquarters in Luxembourg, with hundreds of employees to manage this complex operation”.
UK tax authority (Her Majesty’s Revenue & Customs – HMRC) refused to confirm investigation on Amazon.co.uk, but Amazon business is already investigated in the United States, China, Germany, France, Japan and Luxembourg.
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