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Tax based on value extracted from a country. For example, in the UK I would tax corporations based upon UK Sales - UK Costs. For this I would require Amazon t
by aembleton 5y ago
Tax based on value extracted from a country. For example, in the UK I would tax corporations based upon UK Sales - UK Costs. For this I would require Amazon to set up a UK subsidiary.
Once they have set up a UK subsidiary then they will need to pay a corporation tax based on their total UK sales - UK costs. Sales are sales to the UK; any sales made to other countries, then no tax needed as those countries might (and probably should) have their own tax schemes. Costs would be employee costs, payments made to other UK companies such as an advertising agency or truck leasing and any other taxes they have to pay like rates or VAT.
- wwtrv 5y agoIt’s not really that simple to measure the ‘value’ extracted from a specific country. If we’re considering digital goods Amazon UK could just transfer the profits to Amazon Luxemburg by signing an IP licensing agreement etc. for the same amount they would be taxes on in the UK. So the UK entity would operate at a loss/zero profit. AFAIK many companies are already doing this.
- aembleton 5y agoAmazon Luxemburg is not a UK company, so it wouldn't feature in the UK costs. They would have to pay tax on UK sales - UK costs. Import more (including IP) and you pay more tax unless you also increase your UK costs.