Amazon only paid 4.8% tax on its 6,000 million income in Spain in 2021

Amazon's revenue in Spain "exceeded 6,000 million euros" in 2021, of which it paid 292 million, according to a statement published by the company this Friday. The figure assumes that the multinational paid less than 4.8% of taxes on gross income from all its activities in the country. The company has not published its profit figures in Spain for more than a decade.

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In total, Amazon paid 224 million euros of direct taxes, which include corporate tax, those paid for the purchase of land or the construction of infrastructure on it, as well as the amounts for the payment of payroll and social security of its employees. . Amazon also pays taxes for its digital service characteristics (the so-called Google tax) as well as for the import rights of its products.

The figure is completed with another 68 million euros in indirect taxes. “These are taxes that we collect and remit from our customers, employees and other third parties due to our business activities in Spain. They include VAT and taxes paid by our employees retained by Amazon”, details the multinational.

Amazon emphasizes that its low level of taxation is due to its investments in Spain. It declares to have made investments worth 3,700 million euros in 2021, "more than half" of the income it generated. "Most governments -including the Spanish- actively encourage companies to make these investments and often use the tax system to do so", they explain from the multinational.

One of those investments is the new data infrastructure region that its AWS (Amazon Web Services) division is building. in Aragon. The total of this deployment will reach 2,500 million euros and the company ensures that it will create 1,300 jobs. The center will help AWS, focused on offering web services such as hosting or cloud computing, improve its ability to store data, run workloads and reduce latency. It also counts among its projects with 14 solar and wind farms.

However, Amazon has also been accused on multiple occasions of using financial engineering to reduce its taxation in Europe. “The real strategy of tax planning is the accumulation of losses generated mainly by non-EU affiliates to create tax credits (instead of producing profits)”, report a study prepared by researchers from the University of London and edited by the group of the Left of the European Parliament.

Despite this, the EU Court of Justice has saved its tax regime and annulled a €250 million fine from the European Commission for unpaid taxes through its Luxembourg subsidiaries. "Amazon complies with all US and international tax laws, as well as with financial accounting standards in all the countries in which we operate," emphasizes the multinational.

Low operating profit

Despite the increase in sales during the pandemic, Amazon declares that its operating profits are low "as is the case with retail businesses." “Operating profits remain relatively low due to price pressure in a very competitive market, intense capital investment and rising operating costs (including those resulting from increased labor and inflation)” , states in the statement about its business in Spain sent this Friday.

Although it is compared to small businesses, Amazon is already among the 15 companies that have the most workers in Spain, with some 18,000. Its objective is to grow to 25,000 employees before 2025, to which should be added the hundreds of workers from delivery companies that are dedicated exclusively to distributing their products. El Corte Inglés, its main competitor, invoices a little less than double that of Amazon, but has more than 80,000 employees.

Amazon currently has 40 facilities in Spain between offices and logistics and operations infrastructure. From the multinational they remember that it is not only increasing its logistical weight in the country, but also in its software development divisions. Between data scientists, computer engineers and developers, Amazon has some 600 workers in this sector in Spain.