The multinational corporation tax controversy reared back into life late yesterday as it emerged that Amazon’s UK subsidiary paid just £2.4m in UK tax last year.
This is despite the fact that the company had sales last year of £4.3bn, making its tax rate less than 0.1%, according to the online retailer’s records.
The £2.4m paid in tax is in fact lower than a £2.5m government grant that Amazon received from the Scottish parliament to set up warehouses there.
Margaret Hodge said the tax payment was “just a joke”.
The low tax bill is entirely legal as Amazon’s European base is registered in Luxemburg, and it technically earns its profits there. It is a loophole used by various other multinational companies.
However, the government has been vowing to clamp down on any loopholes.
The head of Google’s northern European operations Matt Brittin is expected to be questioned by MPs later today over his company’s complicity in similar tax avoidance schemes.
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