I have been told the following this morning by a music distributor:
I do £millions of sales to amazon, all buying & marketing negotiated and run through Slough, never heard anything from Luxemburg. The retail / buying management chain went Slough > Seattle to my certain knowledge.
Accounts dept in Slough or offshore in India. Incidentally, I also sold to amazon.de via their Munich office and amazon.fr via Paris.
Meanwhile, in contrast, iTunes ‘buyer' was indeed based in Lux.
What I have also learned is that he told HMRC this in detail in 2010.
HMRC have questions to answer in that case. Why didn't they act if they had this evidence?
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HMRC have yet to explain why they didn’t act on LVCR when they were told in 1988 that it was distorting the market by UK businesses and by a report they commissioned which was later mysteriously destroyed. Until the poor performance of HMRC is dealt with there is little chance we shall see a robust tackling of these issues and poor performance in the civil service is made worse by over protective unions. Get rid of poor staff.
With reference to LVCR, I understand that the off-shoring has now migrated to Switzerland, as predicted. Do HMRC care?
Exactly how are the unions in the civil service to blame for inaction by HMRC senior management or politicians who take no action to close tax loopholes? Ordinary staff in HMRC do the best job they can given the resources available. Since we’ve been losing staff since 2005 and, under this government, every aspect of our working lives is being made worse, don’t be surprised if we don’t get everything right.
Because they will automatically defend people incapable of doing the job. I’ve seen it first hand in local government. The civil service lives in the same bubble that other industries lived in back in the 70s and the only reason they escaped was because the political class wasn’t prepared to tackle it as it was too close to home. I rarely get political but I do on this issue and whilst I accept that there are under resourced over worked staff and that HMRC is not given incentives or anywhere near the right funding I don’t accept that the the civil service in general has to suffer the same rigours of private business. Its very easy to blame poor performance on politicians and just sweep it under the carpet. Too easy.
Richard
I have to say I completely disagree on many issues
Most especially on the rigours of the private sector – where life frequently looks a lot more comfortable than the state sector to me
Richard
While I entirely agree with you that Amazon should pay tax on sales made in the UK to UK residents and delivered from UK warehouses, the fact that they bought the music in the UK surely makes absolutely no difference. Many UK retailers would buy all the stock outside the UK, and that makes no diffrence to their tax position. The other side to this argumnet is that surely Amazon and their expensive tax lawyers would not be stupid enough to source from the UK if it actually made any difference to their tax position.
It’s a whole pattern that is being looked at – not each one item
If they genuinely had no presence in UK that would be believable. Lawyers may be clever with theoretical arms length arrangements but employees may not be so clever at putting them into practice. You only need to show arrangements are not as arms length as they appear on paper and the whole house of cards comes down …
Precisely
There was me thing that the “Land of Make Believe” or “La La Land” only existed as a district within the Los Angeles city limits. It would appear that Amazon’s business model is based on fantasy too! 😉