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Amazon paying less tax, despite jumping profits

Aug 3, 2018

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By Kate Brown

Amazon paying less tax, despite jumping profits - Knowles Warwick

Amazon Services UK saw its profits rise from £48 million to £80 million between 2016 and now. However, the online retail giant paid just £1.7 million in taxes. Compared to the tax payment of £7.4 million in 2016, Amazon displayed a £5.7 million payment difference. Similarly, Amazon Web Services, saw profits rise from £2.7 million to £5 million, whilst tax payments fell from £400,000 to £155,000.

A spokesman for Amazon confirmed that all required tax was paid.

One reason for Amazons reduced tax bill is the rise in share-based payments for employees. Since 2013, full-time Amazon employees in fulfilment centres have received on average shares worth more than £1000 per annum. This year, Amazon UK Services, paid out £18.1 million more in share awards compared to 2016 (£54.8 million vs. £36.7 million). Whilst Amazon Web Services gave share awards of £11.8 million to employees, compared with £5.8 million in 2016.

Investment director at Fidelity International, Rebecca McVittie, said: “technology giants have this hugely dominant role and popular role with consumers and in many respects, what we see in the headlines today, I think there should be more reflection on the need for digital taxation”.

 

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