Amazon corporation tax nudges up 3% as profits soar

Amazon corporation tax nudges up 3% as profits soar

Amazon UK Services paid £14.5m in corporation tax last year, up around 3% from £14m the year before, as profits rocketed.

Pretax profits at the arm, which includes warehouse and operation but not retail, increased to £102m in 2019 from £75.4m with revenues soaring 29% to £3bn from £2.4bn.

The company paid £293m in direct taxes for 2019, up from £220m the year before, with employer taxes taking up the largest proportion, followed by business rates and then corporation tax.

In a lengthy blogpost, the retailer argued the indirect taxes it pays gave a more accurate picture of its total tax contribution.

According to Amazon, it paid an additional £854m, up from £573m, through indirect charges.

“Increases during 2019 were largely driven by net VAT due to an increase in sales and employee taxes as the result of headcount growth and wage increases,” the company said.

In 2019, the total revenues of Amazon’s activities in the UK were £13.73bn, up from £10.9bn, and the company said it invested more than £690m in infrastructure.

A spokesman for the firm said: “We are investing heavily in creating jobs and infrastructure across the UK – more than £23bn since 2010. The UK has now become one of Amazon’s largest global hubs for talent and this year we announced plans to create 10,000 new jobs in the country by the end of 2020, taking our total workforce to over 40,000.

“This continued investment helped contribute to a total tax contribution of £1.1bn during 2019 – £293m in direct taxes and £854m in indirect taxes.”

The online giant reports retail revenues as part of Amazon EU Sarl, where it has a UK branch, with UK retail revenues, associated expenses, profits and taxes reported directly to HMRC.