Up to government to make sure correct sums are levied from business, ecommerce tycoon tells PM
The prime minister confronted the world’s richest man over Amazon’s tax bill when the pair met on the margins of the United Nations general assembly in New York on Monday.
But he said that Bezos – whose personal fortune is estimated at over £130bn – made clear that he believed the onus was on governments to ensure that they have an effective tax system rather than for businesses voluntarily to pay more than is required by the law.
“He’s a capitalist and he made the very important point that this is a job for governments,” Mr Johnson told Channel 5 Nuus.
“And tax isn’t something that he’s going to pay as an ex gratia act of kindness. It’s up to governments to come up with the right framework.”
Asked if Mr Johnson got a sense Mr Bezos accepted he is not paying enough tax in the UK, the prime minister said: “This is a guy who’s making… he has to operate within the commercial framework, within the laws as he finds, that’s what he does.
“We’re trying to make sure we change so as to be fair to the taxpayer, fair to other businesses in the high street and elsewhere.”
Amazon has sparked fury over many years for its minimal tax payments in the UK despite making billions in sales. The company paid £492m in direct taxation in 2020 as its sales rose 50 per cent to £20.63bn.
Chancellor Rishi Sunak is planning a 2 per cent tax on digital sales amid concerns that big tech firms are re-routing their profits through low tax jurisdictions.
The levy, fiercely resisted by tech giants, is intended to redress the balance with bricks-and-mortar businesses which have seen profits savaged as consumers flood away from the High Street to virtual shopping.
Mr Sunak has said that the Covid pandemic made the online retailers even “more powerful and more profitable”.
Amazon’s direct tax bill for 2020 was up by more than two-thirds compared with the £293m it paid in the previous year.
The firm, which employs 55,000 people in the UK, said the taxes included business rates, stamp duty, corporation tax and other contributions.
Recent analysis by union Unite found that the e-commerce giants accounts and public statements showed £13.7bn in sales in the UK in 2019, of which only £5.5bn worth were reported in filings for UK-based companies, with others routed via low-tax Luxembourg.