THE BLOG

Amazon's Tax Crackdown Is The First Step To Fairness

06/10/2017 18:02 BST | Updated 25/10/2017 14:44 BST
Philippe Wojazer / Reuters

In my former life on the Public Accounts Committee, the concept of companies paying their fair share felt at once both the noblest of pursuits and a fool's errand.

Time and again we would see the laughable tax bills from gargantuan global companies who benefited from our custom.

People in my constituency of Blaenau Gwent would look at the companies earning billions and paying back millions and share the bewilderment in a system that didn't feel fair.

Leading figures would point out that companies were playing by the rules, but a hundred different tax systems meant supposedly cast-iron rules had holes you could slip boatloads of profits through.

Some of the slang for these tax-minimising slights of hand - the double Irish, the Dutch sandwich - sound like they'd be better suited in a back-alley brawl.

They seem grimly appropriate for the mugging the British public feel they've been given by the multinationals.

That's why I'm pleased to see the EU look set to hand Amazon a tax bill of nearly 250 million euros as a result of the sweetheart deal they've struck with Luxembourg.

It's taken three years to get to this point - which is three years too long for my tastes - but I believe the European Commission were right to take a long hard look at the situation.

Now, I'm not singling out Amazon as the only offender. To pretend we haven't benefited from their services at some point or another would be silly.

I'm also sure Amazon would point their finger to their base down the road in Swansea and talk about the jobs they bring to the country.

But even there the Welsh Government supported them every step of the way, with an £8.8m Regional Selective Assistance grant and a £3m link road - entitled "Amazon Way".

All we ask for is those companies who enjoy our custom, particularly if we are supporting them financially, to return the favour.

The Labour Treasury team has rightly been banging the drum this year for Britain and beyond to take action to make this happen.

Publishing full tax returns to expose "sweetheart deals".

Companies reporting on overseas activities.

Clamping down on tax avoidance.

These all seem like fair ways to make sure companies play fair.

This step by the EU might only be a one-time payment, but when I look at the headlines this summer where Amazon paid 50% less corporation tax last year in the UK despite a 54% jump in turnover, I'll take it.

This one-off payment means hundreds of millions more for public services and taxpayers across the continent.

Schools, hospitals, front line services and infrastructure all benefiting from the success of these big companies.

Surely that's how it should always work, and a state of affairs worth striving for?

An earlier version of this story indicated Amazon will be charged 400 million euros. This has been corrected to 250 million euros.