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Amazon Reveals Pre-Christmas Trading Hit £13.5bn

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AMAZON CHRISTMAS SALES 2012
Amazon enjoyed a record breaking Christmas as several of its retail rivals fell into administration | PA

As high street retailers continue to suffer, their pain will no doubt be made worse by learning that Amazon pulled in £498 EVERY SECOND in the last three months of 2012.

The online retailer brought in sales of more than £13 billion in the three-month run up to Christmas, although it's not possible to know how much of that came from UK buyers as Amazon famously refuses to split open its European sales into individual countries.

Amazon was highly criticised by the media, politicians and the public over its small corporation tax payments in the UK, along with Google and Starbucks during the autumn of 2012.

Director of public policy Andrew Cecil was forced to explain why a CD or a book bought in pounds on Amazon.co.uk delivered from a UK warehouse by the Royal Mail is registered in Luxembourg.

Cecil visibly squirmed under pressure and frustrated MPs with his vague answers. Chaired by Margaret Hodge MP, the committee quizzing Cecil was astounded - and prompted to scoff audibly - when he refused to detail how many of its European wide sales originated in the UK, telling MPs: "We have never broken out the figures on a country or a website basis."

Hodge retaliated with: "It's insulting to say you don't know what's happening in each territory - your entire activity is here but you only pay a tiny amount of tax."

Cecil also avoided answering how many jurisdictions were investigating Amazon over its tax regimes.

Last year, it was reported that Amazon generated UK sales over the past three years of between £7.6bn and £10.3bn but paid virtually no corporation tax.

At the same time, UK-based retailers including HMV, Jessops and Blockbuster were forced into administration.

"Amazon's stellar sales performance in December will only re-ignite the tax controversy and pour fuel on the bonfire of the UK high street carnage they are causing," predicted Nick Hood, business analyst at Company Watch.

"But the real issue is not the ethical criticism, nor their growing cash mountain, but the wafer thin profitability. It must be galling for its struggling bricks and mortar retail competitors to see their business models being destroyed by Amazon on what is still little more a loss leader basis."

The top seller for Christmas was the Kindle for the second year running. Amazon said sales of ebooks rocketed by 70% in 2012, while sales of physical books suffered the lowest sales in Amazon's 17 years - but even they rose by 5%.

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