Home Business #Amazonmustpay - What Are These Cretins Talking About?

#Amazonmustpay – What Are These Cretins Talking About?

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Presumably all the real problems in the world are solved now that we’ve got people whingeing about convenient retail. Which is what is happening here with the new Amazon Must Pay campaign. Technological change now means that retail over the internet works. Lots of people like this. The price pressures from it – oft dubbed The Amazon Effect – have reduced, at least, inflation by 0.5%. The other way of looking at this is a rise in real wages for everyone of 0.5%. Not a huge amount you might say but that is also, by definition, 0.5% of GDP. Which, for Europe and North America is about $40 trillion a year. Or, running that through the back of the envelope calculator, consumers are better off by $200 billion a year, each and every year, as a result of the existence of Amazon. They’re better off by that amount at minimum.

So, of course, people want to complain. It would be advantageous if those who desired to complain could walk and fart at the same time of course:

This movement begins in Amazon’s own warehouses. While Bezos’s wealth has risen by more than $70bn (£52bn) since the onset of the pandemic, Amazon workers have put their health at risk daily with only marginal increases in pay. The corporation is said to monitor its warehouse workers, sanctions them whenever their productivity drops and has spied on their efforts to organise. The result: claims that workers have been forced to urinate in bottles for lack of adequate break-time (Amazon has disputed such claims), thousands of Covid infections and claims of inadequate worker protections. Bezos could pay each of his 876,000 employees a $105,000 (£79,000) bonus – and still be as obscenely rich as he was before the pandemic broke out.

Basic numeracy would be a start. $70 billion divided by 876,000 is $79,000. £52 billion divided by 876,000 is £59,000. Which is, by the magic of foreign exchange rates, about $79,000. What they’ve done is take that dollar amount and then multiplied it by the inverse of the exchange rate to get to the $105,000. That is, we’re being asked to take advice on international economics from people who can’t even get FX right.

There is also this:

The tax bill says it all: despite revenues of $960bn in the past decade, the company paid just $3.4bn in taxes.

Err, well, corporate income taxes are paid on income – profit – not revenue. This claim therefore coming from idiots which, given that the source is the Fair Tax Mark, is clearly true, they’re idiots:

Amazon. Stands out as the business with the poorest tax conduct, having paid just $3.4bn
in income taxes this decade. The cash tax paid was 12.7% of profit over the decade, at a time
when the federal headline rate of tax in the United States was 35% for seven of the eight
years under examination. The company is growing its market domination across the globe
on the back of revenues that are largely untaxed, and can unfairly undercut local businesses
that take a more responsible approach. The situation is unlikely to reverse soon given the
$9.3bn of operating loss carryforwards available to offset against future profits and taxes

Given that corporate income taxes are paid in arrears the cash tax paid is the wrong measure to be using. But they persist, despite people like me pointing out that by their measure any fast growing firm will have a low tax rate. Because the cash taxes paid this year refer, largely enough, to the profits made last year when the company was considerably smaller.

But this is the Fair Tax Mark, connected with Richard Murphy, so of course it gets even more stupid than this. Note that there’s $10 billion in operating losses. Which means, of course, that there have been losses along that rocky road too. A company pays tax on cumulative profits, not just those in any one year. So even their calculation of the tax rate is wrong, isn’t it?

Stressing Amazon’s profound debts to society, groups such as the Tax Justice Network, Oxfam and Data 4 Black Lives have resolved to make Amazon pay for its abuse of our public institutions.

As ripe a collection of idiots as the world possesses. One day someone will buy them one of those German toilets so they can all do something more useful – examine their own stools.

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14 COMMENTS

  1. I have always followed you and agreed in the main with your argument but the working conditions of Amazon workers is not acceptable in a , so called democratic country, How can you countenance this ?

    • Amazon workers in the US earn considerably more than most people in the world, adjusted for real purchasing power. And the conditions in which they do so are also far above those experienced by most. They are also paid more than most workers, in real terms, in European countries. In fact, in real terms, Amazon workers are amongst best paid people ever to have existed on planet earth,.

    • Dear Anna, the conditions are obviously acceptable, if not to you, then to the workers lining up to get a job at Amazon. As Tim would say, sigh.

  2. On the one hand, Amazon pays a lot more in tax than stated. It probably pays various property taxes on its premises, and it certainly pays employers’ PAYE. You could even argue that it pays sales tax or VAT since that;s also money Amazon receives but has to pass on to the state.

    On the other hand, people cannot carry forward losses, so I can see why some unfairness can be perceived. If I take a year off work to learn some new skill, I can’t then use that year’s tax free allowance in subsequent years, even though the later profits are caused by the year of losses.

    • Actually, Charles, any individual can carry forward their trading losses, the same as Amazon. True, they can’t carry forward their tax free allowance, but then again, companies don’t have one of those, do they?

      • Only businesses can carry forward losses. Note that a person can also be a business (sole trader, partnership member, etc), so for tax purposes they appear to be able to claim losses, but these are not personal losses. For example, if a business rents an office in a town, that’s an expense which reduces taxable profit, but if a person rents a flat in a town to live in – even if that’s because they want to live there as it’s where there is demand for their services – it’s not offsettable against income. Similarly, someone who pays £9000 for three years for a university degree does not get to claim £27000 in subsequent years as a loss.

  3. Prior to Lockdowns the U.S. had the lowest unemployment rate ever – if Amazon treated people badly they had plenty of other options. Note, also they cite “claims” about peeing in bottles. And, of course, seem to think it’s an outrage that Amazon actually manages employees’ productivity – so if they hire someone to work in the office they’ll pay no attention to whether the new employee is actually doing their job?

  4. American Corporations should be taxed on their turnover – not their profits (which are too easy to hide). Texas does that – and Texas is not a left wing place. The financial support that American Corporations gave to the doubling of the Arizona State Income Tax (and their gloating after the measure was past) was the last straw. This was a tax on their competitors – they know that small business files under the individual income tax (not the Corporation Tax). American Corporations also deduct their local and State Property Tax before from their taxable income – before it is subject to Corporation Tax. A private individual in business is not allowed to do that (no wonder the Corporations back wild spending city governments – they DO NOT PAY FOR THEM)- it is another Corporate advantage (and the Corporations are mostly owned by institutions, pension funds and the like, who also get special treatment).

    The whole thing stinks. And the Corporations “rewarded” President Trump for cutting Corporation Tax in half, by stabbing him in the back. Amazon is Jeff Bezos (just paying a lower rate of tax than Mr Bezos would pay if he was not using a Corporate cover) and Jeff Bezos is the Washington Post – which pushes every far left cause you can think of. The other Corporations, Disney, Comcast, Google…… are the same, they all back Collectivism (knowing that small business will have to pay for it – NOT THEM). Amazon and the other Corporations (hello Bank of America) even gave “Black Lives Matter” money to burn down small business enterprises (some store owners were burned alive). And you want to defend these enablers of Marxist terrorists?

    By the way the defence of “Jeff Bezos and the others know it is all nonsense – they just pay the Marxists to keep them off their back” is no defence at all. The small businesses are still taxed to death (or closed by Corporate backed “LOCKDOWNS”), or burned. And the store owners are still left with the only alternative left being to end their lives – suicide.

    • It would be helpful to start with how Texas does in fact tax corporations:

      Franchise tax is based on a taxable entity’s margin. Unless a taxable entity qualifies and chooses to file using the EZ computation, the tax base is the taxable entity’s margin and is computed in one of the following ways:

      total revenue times 70 percent;
      total revenue minus cost of goods sold (COGS);
      total revenue minus compensation; or
      total revenue minus $1 million (effective Jan. 1, 2014).

      If it’s revenue minus COGS then it’s not revenue, is it? In fact, in standard parlance, that’s taxing gross profit rather than net profit…..neither of which are turnover.

  5. For many years I supported cutting Corporation Tax. But the behaviour of the “Woke” Corporations (their backing of Marxist terror groups such as “Black Lives Matter” to burn down their small business competitors – and their support for ever higher taxes on small business, to pay for wild government spending) , can no longer be ignored. I repeat what Google (and the rest of them) did in Arizona (support the doubling of taxation on their competitors – to have yet more spending on the, far left dominated, “education” system). was the last straw. No one can pretend that the Corporations are anything to do with “free enterprise” now.

    • “No one can pretend that” is straight out of the phrasebook for politicians getting up on their back feet at a public meeting. It’s an unproven assertion and while entertaining, does not convince.

  6. Re: Paul Marks’ comments I certainly agree that the perception that large corporations are conservative or favor Republicans is false. They very much love having the gov’t involved in most cases because they can arrange things so that it hurts small businesses far more than them. If a new law dings me slightly but hammers my small business competition I come out ahead.

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