Home Business News Amazon’s tax to turnover ratio just 0.37% on UK sales

Amazon’s tax to turnover ratio just 0.37% on UK sales

by LLB Finance Reporter
8th Feb 21 11:57 am

The pandemic and growth of online shopping saw Amazon’s UK sales rise by more than 51% last year whilst its tax (business rates) to turnover ratio dropped to just 0.37%.

Amazon’s UK sales for the year ended 31st December were $26.48 billion during 2020 up from $17.53 billion in 2019 up 51%.

The 2020 UK sales are circa £19.4bn

Looking across Amazon’s entire UK estate including fulfilment centres, research and development centres, corporate offices in London, Amazon Lockers, Whole Foods Market stores, and delivery stations overall business rates liabilities were estimated by the real estate adviser Altus Group to amount to around £71.5 million at the start of the 2020/21 financial year.

Tax to turnover ratio 0.37%

In comparison, before the onset of the pandemic, the Centre for Retail Research say bricks-and-mortar retailers paid around 2.3% of annual retail sales overall in business rates.

Robert Hayton, UK President of Property Tax at Altus Group, said “Covid-19 had driven online sales accelerating the need to address the disparity in tax to turnover ratios” adding the Government are right to be considering a sales tax for large online only retailers to level the playing field but stressed “this is simply about fairness and cannot be a tax grab on the overall retail sector. Additional revenue raised would have to be ring fenced.”

The government committed to conducting a fundamental review of business rates and published the terms of reference for that review at the Spring Budget in 2020.

This call for evidence seeking views on how the business rates system currently works, issues to be addressed, ideas for change and a number of alternative taxes, including an online sales tax, was issued in July 2020.

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