The giant US tech firms who are known as the Silicon Six have paid £70 billion less tax in the past decade than claimed, a bombshell new report has alleged.
Amazon, Facebook, Google owner Alphabet, Netflix, Microsoft and Apple were all singled out by campaign group Fair Tax Foundation, which claimed the firms paid less in tax between 2011 and 2020 than the figures in their annual financial reports.
They also paid around £105 billion less to global tax authorities than expected with campaigners saying they deliberately shifted income to low-tax areas so they would pay less.
Amazon was the biggest culprit, according to the report, paying just 9.8 per cent of profits as tax, the lowest of the group.
Jeff Bezos’ firm paid £4 billion in income taxes this decade, despite claiming to have paid £7.5 billion.
Apple paid £70bn instead of the claimed £100bn, Facebook paid £11.5bn instead of £21.5bn, Google paid £27.3bn not £35bn, Microsoft £38.8bn not £55.7bn and Netflix paid £0.8bn instead of £1bn.
The revelations come as Chancellor Rishi Sunak prepares to call on world leaders to support a new ‘tech tax’.
Chancellor Rishi Sunak is preparing to call on world leaders to support a new ‘tech tax’
The ‘Silicon Six’ are facing new claims of tax dodging. Amazon was the biggest culprit, according to a report, paying just 9.8 per cent of profits as tax, the lowest of the group
Mr Sunak said he wants companies to pay the ‘right tax in the right places’, ahead of next week’s G7 summit in the UK.
He told the Mail on Sunday: ‘Fundamentally, the global tax system isn’t working… that’s not fair and that’s something that I want to fix.’
His efforts will be bolstered by the report from the Fair Tax Foundation.
An Amazon spokesperson disputed the calculations as ‘extremely misleading’.
They told the Guardian: ‘Amazon is primarily a retailer where profit margins are low, so comparisons to technology companies with operating profit margins of closer to 50% is not rational.’
A Facebook spokesman said: ‘All companies pay tax on their profits, not revenues. Last year we paid $4.23bn in corporate income taxes globally, and our average effective tax rate over the last 10 years was 20.71%, which is roughly in line with the OECD average.’
Paul Monaghan, chief executive of the Fair Tax Foundation, said: “Our analysis of the long-run effective tax rate of the Silicon Six over the decade has found that there continues to be a significant difference between the cash taxes paid and both the headline rate of tax and, more significantly, the reported current tax provisions.
‘These figures provide solid evidence that substantive tax avoidance is still embedded within many large multinationals and nothing less than a root and branch reform of international tax rules will remedy the situation.’
Rishi Sunak today called on the US Government to sign up to a groundbreaking new global tax targeting the super-profits of tech giants such as Google and Facebook.
Facebook paid just $16.8bn in income taxes this decade, despite making profits of $133bn and revenues of $328bn
Google owner Alphabet, Netflix, Microsoft and Apple were also singled out by campaign group Fair Tax Foundation
In an exclusive interview with The Mail on Sunday, the Chancellor urges President Biden’s administration to conclude negotiations over the new tax – which would bring in billions of pounds in extra revenue – in time for next month’s G7 summit in Cornwall.
It comes after years of criticism about the way technology companies have channelled profits through tax havens to minimise the amount they pay on their vast revenues.
The Biden administration has indicated that it is prepared to drop its opposition to the ‘tech tax’ in return for an agreement to introduce a new minimum level of corporation tax around the world. That is expected to be set at 15 per cent.