My lowest point came when I ordered a pair of bootlaces for a couple of quid. Now I avoid the site at all costs
I confess. I’m a recovering Amazonaholic. It started innocently enough. It was just the odd hard-to-find book title. Then I moved on to DVD box sets. I found it so easy, so tempting. Then they started pushing other things on to me. I began spending large amounts of my income on my Amazon addiction. A satnav. A TV. A laptop. An iPad. It became a favourite on my computer. It was like it was my friend, there to help me. My lowest point came when I ordered bootlaces for a couple of quid. Well, I thought, I’ll probably forget to buy them tomorrow and Amazon will deliver by then. And they did.
Amazon is an extraordinary phenomenon. It is ruthlessly efficient, has low prices and excellent delivery (or “shipping” as it says, in distressing Americanese). It is renowned for economies of scale and tight cost control – and now for aggressive tax avoidance. The UK’s biggest online retailer has avoided paying corporation tax on profits it makes from billions in sales here.
If I ran a toy shop, and the toy shop next door was undercutting me because it didn’t pay tax, I’d be pretty angry. It’s a mystery that businesses up and down the UK are not complaining loudly about a situation where some firms pay tax, but others don’t.
Until it changes its position on tax, Amazon will no longer be getting my cash. But I doubt Jeff Bezos, Amazon boss, is shaking at the loss of my £1,000 or so a year. As Richard Murphy at Tax Research points out (he’s one of the few accountants willing to speak out about corporate tax avoidance), consumer boycotts work best when they are highly visible. Protestors outside Barclays during the apartheid era helped to change the world. Not clicking on a computer changes little. Still, I’m beginning to see it as a citizen’s duty to avoid the tax avoiders.
I’ve written approvingly about Starbucks and the steps it took to support Fairtrade. It’s a shame it doesn’t back fair taxes. No more skinny lattes.
Boots is another. A BBC File on 4 programme found that, after relocating to a post office box in Switzerland, Boots legally cut its tax bill from more than £100m a year to about £14m. Let’s face it, a personal boycott isn’t back-breaking stuff. I’ve noticed the cold sore cream I’m using is Boots Avert (I bought it some time ago). Switching from Boots to the local chemist is hardly personally challenging. Yet the more of us who do so, the stronger the message becomes.
This isn’t really a leftwing/rightwing thing. There is a growing consensus that in clone town Britain the big chains suck money out of local communities, remitting it to shareholders, many of them now overseas. Even if the local pharmacy costs a few pence more, the money you spend circulates locally, creating a multiplier effect.
But corporate tax avoidance runs so deep that few us of have confidence the company we switch to is any better than the one we left behind. Even the Guardian Media Group has come under fire for holding some of its assets through companies in the Cayman Islands and Luxembourg.
When governments are broke, and households overindebted, it’s time to focus on the mind-boggling amounts of cash corporates have amassed in recent years. Apple has more than $80bn in its coffers, yet pays less than 2% tax on its huge overseas profits. Amazon, Google and Starbucks will face MPs on Monday to explain their tax position. They should be grilling Apple as well as well.
Murphy proposes relatively simple measures to catch the corporate tax avoider which maintains the fiction it is based in a tax haven where it does no real business. But it needs international co-operation. Germany and France are keen to act, Britain is slowly coming on board. Ireland, shamefully, remains hooked on its corporate tax loopholes. The country wants to renegotiate its costly EU bailout, which Brussels should firmly resist until the country harmonises its corporate tax rates with Europe. Murphy (an Irish passport holder) even calculates that Ireland will suffer little or no cost if it abandons its tax dodge.
Murphy has published a number of books on how to tackle global tax avoidance. But he admits it’s an almost delicious irony about where he gets most of his sales. Guess where? It’s Amazon.
Need a Loan? Visit Secured Loans Broker.
View full post on Free Secured Loans Advice