Labour MP and chair of the public accounts committee Margaret Hodge has called for UK shoppers to boycott online retailer Amazon.
That's because Amazon UK paid just £4.2m in tax to the UK treasury this year (and £3.2m the year before) despite registering sales to the tune of £4.3bn. That represents a tax rate of 0.1 per cent.
It has only paid £10m in corporation tax over the last ten years, while sales over the last four years have totalled £23bn. It is able to do this as it exploits a tax loophole allowing it to charge sales taxes to Luxembourg.
"It is an outrage and Amazon should pay their fair share of tax," Hodge said, as reported by The Guardian. "They are making money out of not paying taxes. I no longer use Amazon. We should shop elsewhere. What we demonstrated with Starbucks is the power of the consumer voice.
"If you are an Amazon user you get endless emails saying Amazon.co.uk. You then order your goods and you get them delivered by the Royal Mail in parcels stamped with the Queen's head, and they then pretend it's nothing to do with business in the UK.
“They are damaging British jobs. If you are a small bookshop in the high street you can never compete with their prices, because you pay taxes. Even for John Lewis their future is also threatened because they pay their taxes."
Last year Starbucks came under intense pressure after it was revealed in had paid just £8.6m in corporation tax over a 14 year period in the UK. Last year it paid £5m.
Amazon currently employs 7,000 staff in the UK.
"Amazon pays all applicable taxes in every jurisdiction that it operates within,” the retailer retorted. “Amazon EU serves tens of millions of customers and sellers throughout Europe from multiple consumer websites in a number of languages dispatching products to all 28 countries in the EU.
“We have a single European headquarters in Luxembourg with hundreds of employees to manage this complex operation."