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Amazon is earning more money and paying less tax. How did that happen?

Paying employees in shares helps. Oh, and being smart about where you register your business.

Amazon's somehow swung it that they're paying 2.8 million less in tax in 2017 than 2016, despite considerably higher profits.

What it means: Did you know Jeff Bezos, CEO of Amazon, is now richer than Bill Gates? That's how much money Amazon has.

Yet somehow, Amazon UK Services, the branch of the company managing customer services and logistics in the UK, lowered its 2017 tax bill and deferred some of the tax to the following year. That means they paid £1.7 million on £2 billion revenue and £80 million in profits.

This figure is only part of the company's full tax bill in the UK, because their retail sales are directed through a company registered in Luxembourg - but they won't disclose the total sum to the press.

One of the main reasons their tax levels are so low is because the company's now started providing share awards to employees, i.e. giving them part of the company rather than wages - which you don't have to pay tax on. It works out pretty nicely for the employees themselves - entry level associates got an average of £3,000 a year, with senior staff getting considerably more.

The company's spokespeople say they've made billions of pounds of investment into the UK, and are planning to create 2,500 jobs. In other words, they're doing their bit for the country. Just not in tax.

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Reader Comments

  • RW

    Your right to a degree. You mentioned “the wandering Jew”.

    I elaborate that the Jewish people, historically have tended to migrate almost exclusively to locations that are economically and culturally vibrant already. I would speculate that Jews have thrived in these places and have often improved the bounds of their economies and knowledge base.

    You can also ask; how many massive entertainment conglomerates, Nobel winners or billionaires has Isreal developed? If Jews are so capable, why isn’t Tel Aviv the Rome of our time?

    Jews are successful because they value education, maintain a strong social cohesive, they actively monitor and have a good sense for Zeitgeist wherever they are and they carefully choose the places they settle and congregate themselves heavily in these choice locations.

    But most importantly (haulocaust increased the importance of this aspect), they actually designed their culture for success. They not only attend Harvard, they use what they learned to better the group as a whole. With as much, they studied intricate networking systems, adapted to it and in many cases improved upon them. (See how Japan acquired Aegis warships and made them better).

    Of course there is nothing wrong with any of this. It’s when you elaborately gain disproportionate power in any society where you would stand out, you must take care when attempting to make a society better (Civil Rights movement) and rewriting that society all together (mass immigration). Ask blacks in China, Mexico, Philippines or India how much opportunity they have? Go to businesses owned by their American diaspora and see how many blacks they hire. Go to Silicon Valley and see how many East or South Asian tech workers wish they could work with more black people. California might work as a state, but as a nation, I think your rolling the nuclear dice here. I hope we can succeed as a tolerant pluralistic superpower but at this stage in human societal development, it’s a pipe dream.

    And if Jews really are the icon for success, they would see that fundamental human successes happen over generations. Just look at the rest of the planet? Are we ready?