Amazon gave UK £1m tax credit as profits rise 60% to £204m | Amazon

Amazon’s main UK division was granted a tax credit of just over £1million last year by HM Revenue and Customs, despite the nearly online retailer’s rising profits 60% to £204 million.

The tax benefit was part of €1bn (£850m) in tax credits given to Amazon by governments across Europe, up from €56m a year earlier, accounts show filed for the Luxembourg division of the American company.

Amazon’s losses across Europe soared 90% to 2.1 billion euros before the tax break, despite sales up nearly 16% to 51 billion euros.

At the annual shareholder meeting in May, Amazon frustrated efforts to force the company to be more transparent about financial affairs.

Amazon UK Services, the group’s warehouse and logistics company, which reportedly employs more than half of the company’s UK workforce of nearly 75,000 people, boosted revenue by just over a quarter to reach £6.09billion, according to accounts to be filed with Entreprises Loger.

However, he set aside £1m of the £18.3m he had set aside to pay his corporation tax bill in 2020, which resulted in the credit in his accounts.

Amazon said: “This credit relates to an accounting adjustment to our 2020 accounts. We have not received any payment from HMRC.

The company has also benefited from the government’s “super-deduction” scheme for companies investing in infrastructure, which was introduced by then-Chancellor Rishi Sunak last year.

The relief, which allows businesses to offset 130% of plant and machinery capital expenditures against profits for two years from April 2021, has left Amazon with no tax liability in 2021.

Amazon said total UK revenue, including all business from retail to cloud services, rose 12.6% to £23.2 billion last year, placing the business slightly ahead of Asda, the UK’s third largest supermarket, in size and more than double. by Mark & ​​Spencer.

Paul Monaghan, chief executive of the Fair Tax Foundation, said: “The figure that Amazon still refuses to disclose is exactly the total amount of profit it makes in the UK and the tax it pays on that. This is despite numerous requests not only from civil society activists, but now also from a significant number of their institutional investors.

“It appears that Amazon is increasing its market dominance across the world through largely untaxed revenue, allowing it to unfairly undermine local businesses that take a more responsible approach.”

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Amazon said in a statement: “The government is using the tax system to actively encourage businesses to invest in infrastructure and job creation. Last year we invested more than £11.4 billion in the Kingdom. United, building four new distribution centers and creating more than 25,000 jobs.

“We are investing heavily in creating jobs and infrastructure across Europe – over €100 billion since 2010. Corporation tax is based on profits, not income, and the Last year, Amazon EU Sarl recorded a loss as we opened more than 50 new sites across Europe. and created over 65,000 well-paid jobs, bringing our total European permanent workforce to over 200,000.

“Across Europe, we pay corporate taxes amounting to hundreds of millions of euros. We operate this pan-European business from our head office in Luxembourg, where we have over 3,600 employees and growing, including our management team.

Amazon said it paid £648m in ‘direct taxes’ in the UK in 2021 – up from £492m a year earlier – but these include employer national insurance contributions, business rates, corporation tax, import duties, stamp duty property tax and digital services tax.

Amazon does not detail how much it pays in corporation tax for the whole of the UK business, leaving the UK services branch as the best indicator of the bill.

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