11 June 2019
How much longer must we talk about the outrage of the big US firms not paying fair tax in our country, whilst reaping the rewards from our consumers?
It is way beyond time for the government to take real action to tackle the huge gap in the amount of tax paid by some of these tech giants compared to the rest of the nation’s businesses, who are not on a level playing field.
Not only do British firms have to continue to battle the uncertainty of Brexit and the troubled High Street, they are also competing – us included – with huge multi-national corporations with deep pockets and smaller tax bills. It is an untenable situation.
This morning, the Guardian reported that Amazon received £11m from HMRC last year for using its Amazon Web Services (AWS). That’s more than six times the £1.7m that it received in corporation tax from Amazon’s main UK business.
The irony is that HMRC went to Amazon to save money!
Over the course of the year, central government spent more than £45m with the Amazon group. When you consider that Amazon has paid just £61.7m corporation tax over the course in 20 years – TWENTY YEARS – that number is astounding. According the The Mirror, Marks and Spencer paid more than that in the past year alone. In those 20 years, it is reported that Amazon generated £7bn in UK turnover.
When you look at the state of the country at the moment, I cannot fathom why on earth our government are not making the most of absolutely every opportunity to boost the coffers. Particularly when you consider the situation in Britain, at the moment.
‘A harsh and uncaring ethos’
Headlines including: “Austerity to blame for 130,000 preventable UK deaths”, and the recent UN report which states that whilst the UK is the fifth largest economy in the world, one fifth of the population lives in poverty, and 1.5m of those experienced destitution in 2017.
It reads: “The social safety net has been badly damaged by drastic cuts to local authorities’ budgets, which have eliminated many social services, reduced policing services, closed libraries in record numbers, shrunk community and youth centres and sold off public spaces and buildings. The bottom line is that much of the glue that has held British society together since the Second World War has been deliberately removed and replaced with a harsh and uncaring ethos.”
Of course, one company paying their fair share in corporation tax won’t solve all of our problems overnight, but it would help. Imagine if each of the big American tech firms all did the same – Facebook, Uber, eBay, Google. It’s not just the tech firms either, The Express reported in September last year that Starbucks’ UK-based European operations made £162m profit and paid £4.5m in tax, despite the UK corporation tax rate being 19%. The coffee chain hit the headlines back in 2012 after it was reported that they paid just £8.6m corporation tax in Britain across 14 years, despite generating £3bn in sales.
It needs to be simple
While we’re all distracted by Brexit, fires are raging around us, and these ridiculous situations remain unaddressed. I am incredibly proud that we pay our fair share of tax in the UK. I know that that goes into paying for schools, hospitals and policing. If you make money in the UK, regardless of who you are or where your business was founded, you should pay the tax rate in the UK. It needs to be that simple.
We’ve had empty promise after empty promise about tackling this issue, and something needs to happen now. We can’t speak of austerity on the one hand, which takes away from the British people, and on the other be reducing costs for big multi-billion-pound businesses. It isn’t right. We need to balance Britain’s books.