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Amazon, Britain’s largest online retailer, sells almost one in every four books in Britain. The company is currently being investigated by HM Revenue and Customs for possible tax avoidance, by allocating its UK sales to a company in Luxembourg. Amazon is also being investigated in China, Germany, France, Japan and the US.
Reports show that in the past three years Amazon’s UK sales were between £7.6 billion and £10.3 billion, but from 2003 to 2011, the UK registered company paid only £3 million tax.
It is thought that the UK operation has been avoiding tax since the ownership of Amazon.co.uk was transferred to a Luxembourg-based Amazon EU Sarl company in 2006. The UK operation is a delivery company, and all payments from the UK are transferred to Luxembourg.
Tim Waterstone, bookselling retail chain Waterstones’ founder, said Amazon’s tax avoidance reflects the company’s “rude, contemptuous, arrogant and subversive” attitude to the rest of the book trade. He also says Amazon’s “grotesquely unfair” avoidance of millions of pounds of UK taxes could result to the death of high street bookshops.

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