Amazon pays just £38 million a year in business rates in England and Wales, it can be revealed today.
A Daily Mail investigation exposes the scale of the internet retailer’s vast UK property empire, and the relatively meagre sum it pays in commercial taxes.
For its 189 sites across England and Wales, Amazon faces a total business rates bill of £38 million. By comparison, struggling department store chain House of Fraser pays £36 million.
That is despite Amazon raking in £9 billion in sales – more than 11 times the amount made by House of Fraser.
Amazon’s properties range from vast warehouses to offices and even the lockers it uses to drop off parcels at public locations.
But even though its bills rose under a recent review of business rates, high street retailers are still paying far more.
It comes as Amazon faces accusations it is killing the high street by reducing its corporation tax bill to the lowest possible level and ruthlessly undercutting rivals.
Bricks-and-mortar shops are being hammered with soaring business rates while the web giant enjoys low rates in out-of-town warehouses. The Mail is campaigning for business rates in Britain to be reformed.
The latest Amazon figures were uncovered in research for the Mail by property adviser Altus Group.
Robert Hayton, head of UK business rates at the firm, said online-only retailers such as Amazon were paying market rents for their buildings while traditional retailers were forced to stump up much bigger taxes for their high street properties. He added: ‘If left unchecked, this could lead to the extinction of the high street.
‘The Government should use this crisis to accelerate its commitment to create a coherent approach to taxing the digital economy.’ He suggested this could involve a tax on digital sales, one possible option being looked at by ministers. At the moment corporation tax is levied only on profits.
Business rates are calculated using a property’s ‘rateable value’.
This is defined as its market rental value as of April 1, 2015, and the figure is estimated by the Valuation Office Agency.
When previously approached by the Mail, Amazon refused to reveal the full scale of its business rates bills, despite other retailers providing their figures. However, the new research lays bare for the first time its taxable estate.
Calculations for the Amazon bill were based on a public database of how much every property is required to pay and cross-referenced with sites owned by Amazon.
The internet giant contested the findings but refused to provide an alternative figure.
A spokesman said last night: ‘This research is misleading and inaccurate.
‘Amazon pays millions of pounds more in business rates in England and Wales than suggested by the research and our business rates bill has increased significantly in 2018.’
Amazon’s overall business rates bill increased slightly under a country-wide review that saw it pay more for several of its properties. For example, the business rates it pays for its 12-floor office at Holborn Viaduct, London, rose from £31 million in 2016 to about £33 million this year.
By comparison, House of Fraser’s flagship Oxford Street store in London saw its business rates bill increase by a crippling 57 per cent to £228 per square metre earlier this year. It has since announced the store will be closed.
And John Lewis, which recently warned on profits, pays £155 per square metre on its High Wycombe store.
Amazon paid just £27 per square metre for its huge warehouse in Swansea and £67.50 per square metre for another in Hemel Hempstead, Altus Group found.
Earlier this year, Chancellor Philip Hammond admitted the Government needed to find a ‘better way’ to tax internet giants. But he sparked fury by ruling out any imminent changes to the rates regime, despite mounting evidence that it is killing off firms.