4 ms·

Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? Unless the article contains any

Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? Unless the article contains any details or hint whatsoever of undue deductions artificially depressing paper profits (it doesn’t) there’s absolutely no reason to find any issue in a company paying no profit taxes when it makes a loss. Sales get taxed with sales tax, which Amazon paid in the EU in the billions like any other company. I’m not absolving Amazon here but this article contains nothing damning.

lotsofpulp 5y ago
> I’m not absolving Amazon here but this article contains nothing damning. Pointing out a company that plays by the government’s rules and minimizes tax obligations is a reliable mechanism to get people emotional and result in clicks. It is funny to me, though, on a forum with otherwise “knowledgeable” or “discerning” people, that finance topics invite a considerable portion of forum members to disregard their skepticism and join in emotional manipulation of the article. As opposed to learning what the causes for low tax liability are, discussing if it’s reasonable policy, and what changes to tax law need to be made, it’s just a bunch of comments screaming “tax evasion”.
martin-adams 5y ago
I recall something about movie studios setting up their business so that a successful film can technically be a flop because of all the internal billing. I recall this affecting royalties to those involved in making because it supposedly made less money. Is the same thing going on here? Is Amazon unprofitable in Europe because it’s billing itself from another Amazon entity outside of Europe thus wiping out the profit?
- IkmoIkmo 5y ago
  Well, that's what I'm wondering but the article doesn't specify at all. It's like an article's headline states: Amazon stopped paying thousands of employees it hired last year. Incendiary title, is Amazon perhaps breaking the rules? And then you click on it and read that Amazon did not renew contracts of 10% of the employees it hired last year, and is therefore not paying them anymore as they're not working for Amazon anymore. Which is normal business procedure, just like not having to pay taxes when you take a loss. And then the second question is, were the people fired illegitimately perhaps? Or did Amazon use a ta trick? Well who knows, the article doesn't mention a shred of evidence of it. That's why it's poor journalism. I'm not absolving Amazon of any faults, it's obviously a company with many faults and issues and I would not be surprised if there's any more. What I am saying is that this article doesn't present any evidence of any faults, yet insinuates them. I tend to like reading the Guardian so it's a disappointment to see a lack of nuance or information.
beckman466 5y ago
> Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? You cannot be serious. Just because multinationals hack the tax system using dirty tricks doesn’t mean what they do is legitimate.
- rlpb 5y ago
  So investigate and report on the illegitimacy then. This article fails to do that.
- IkmoIkmo 5y ago
  Of course I’m serious. I explicitly state I’m not absolving Amazon of anything. What I’m saying is that the article contains no information at all on any dirty tricks being used, yet implies acting in bad faith. That’s just bad reporting. If it’s not legitimate then point out in the article why, the reporter failed to do that. Not paying profit taxes on a loss is the most normal thing in the world. Paying billions in salex tax (as Amazon did) on tens of billions in revenue, is also the most normal thing in the world. Where’s the issue? The article doesn’t clarify whatsoever.
mschuster91 5y ago
> Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? Because if Amazon makes a loss on selling 44 billion € of merchandise, either Amazon is incompetent beyond belief or they engage in somehow-legal tax dodgery at the expense of European countries whose infrastructure they mercilessly wreck. Simple logic leads to the latter explanation being more likely.
- whitepaint 5y ago
  Should Amazon give away their money voluntarily? Just by playing by the rules is not good enough? When you do your taxes, don't you with your accountant try to pay as little as possible?
  - cynix 5y ago
    > When you do your taxes, don't you with your accountant try to pay as little as possible? As a salary-earning individual, there's very little you can do to actually reduce your taxes by a meaningful amount, let alone down to zero like these corporations can.
    - whitepaint 5y ago
      I'm a freelancer, I'm sure many here are as well. I do my own taxes (or more precisely, my accountant does). And it was more to demonstrate, does anyone pay more than they have to? Why do we expect businesses to act differently than how individuals do?
    - wolfretcrap 5y ago
      Then why not start a company if the grass is sooo much greener on other side. It's true you can claim a lot as expense and register zero profits but only when you really don't have money. People forget, Amazon gets its money from stock market - this money is someone's pension funds and savings, they are investing because people believe Amazon will one day then profit, they don't care about these losses. So what's the alternative? Prevent people from investing into profitable things?
nspattak 5y ago
Well, in case you really do not get it, ket me spell it out for you in a small easy to understand sentence with simple words: Their reported profits are a tax evasion trick. This is hurting the very same people and nations from which they profit.
- nprateem 5y ago
  Tax avoidance is legal, even if morally reprehensible. Evasion is illegal. There's no mention of evasion here is there?

lotsofpulp 5y ago

> I’m not absolving Amazon here but this article contains nothing damning. Pointing out a company that plays by the government’s rules and minimizes tax obligations is a reliable mechanism to get people emotional and result in clicks. It is funny to me, though, on a forum with otherwise “knowledgeable” or “discerning” people, that finance topics invite a considerable portion of forum members to disregard their skepticism and join in emotional manipulation of the article. As opposed to learning what the causes for low tax liability are, discussing if it’s reasonable policy, and what changes to tax law need to be made, it’s just a bunch of comments screaming “tax evasion”.

martin-adams 5y ago

I recall something about movie studios setting up their business so that a successful film can technically be a flop because of all the internal billing. I recall this affecting royalties to those involved in making because it supposedly made less money. Is the same thing going on here? Is Amazon unprofitable in Europe because it’s billing itself from another Amazon entity outside of Europe thus wiping out the profit?

IkmoIkmo 5y ago
Well, that's what I'm wondering but the article doesn't specify at all. It's like an article's headline states: Amazon stopped paying thousands of employees it hired last year. Incendiary title, is Amazon perhaps breaking the rules? And then you click on it and read that Amazon did not renew contracts of 10% of the employees it hired last year, and is therefore not paying them anymore as they're not working for Amazon anymore. Which is normal business procedure, just like not having to pay taxes when you take a loss. And then the second question is, were the people fired illegitimately perhaps? Or did Amazon use a ta trick? Well who knows, the article doesn't mention a shred of evidence of it. That's why it's poor journalism. I'm not absolving Amazon of any faults, it's obviously a company with many faults and issues and I would not be surprised if there's any more. What I am saying is that this article doesn't present any evidence of any faults, yet insinuates them. I tend to like reading the Guardian so it's a disappointment to see a lack of nuance or information.

beckman466 5y ago

> Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? You cannot be serious. Just because multinationals hack the tax system using dirty tricks doesn’t mean what they do is legitimate.

rlpb 5y ago
So investigate and report on the illegitimacy then. This article fails to do that.
IkmoIkmo 5y ago
Of course I’m serious. I explicitly state I’m not absolving Amazon of anything. What I’m saying is that the article contains no information at all on any dirty tricks being used, yet implies acting in bad faith. That’s just bad reporting. If it’s not legitimate then point out in the article why, the reporter failed to do that. Not paying profit taxes on a loss is the most normal thing in the world. Paying billions in salex tax (as Amazon did) on tens of billions in revenue, is also the most normal thing in the world. Where’s the issue? The article doesn’t clarify whatsoever.

mschuster91 5y ago

> Terrible article, Amazon didn’t pay profit taxes, because Amazon didn’t make profits but instead, a loss. How is this an issue? Because if Amazon makes a loss on selling 44 billion € of merchandise, either Amazon is incompetent beyond belief or they engage in somehow-legal tax dodgery at the expense of European countries whose infrastructure they mercilessly wreck. Simple logic leads to the latter explanation being more likely.

whitepaint 5y ago
Should Amazon give away their money voluntarily? Just by playing by the rules is not good enough? When you do your taxes, don't you with your accountant try to pay as little as possible?
- cynix 5y ago
  > When you do your taxes, don't you with your accountant try to pay as little as possible? As a salary-earning individual, there's very little you can do to actually reduce your taxes by a meaningful amount, let alone down to zero like these corporations can.
  - whitepaint 5y ago
    I'm a freelancer, I'm sure many here are as well. I do my own taxes (or more precisely, my accountant does). And it was more to demonstrate, does anyone pay more than they have to? Why do we expect businesses to act differently than how individuals do?
  - wolfretcrap 5y ago
    Then why not start a company if the grass is sooo much greener on other side. It's true you can claim a lot as expense and register zero profits but only when you really don't have money. People forget, Amazon gets its money from stock market - this money is someone's pension funds and savings, they are investing because people believe Amazon will one day then profit, they don't care about these losses. So what's the alternative? Prevent people from investing into profitable things?

nspattak 5y ago

Well, in case you really do not get it, ket me spell it out for you in a small easy to understand sentence with simple words: Their reported profits are a tax evasion trick. This is hurting the very same people and nations from which they profit.

nprateem 5y ago
Tax avoidance is legal, even if morally reprehensible. Evasion is illegal. There's no mention of evasion here is there?