eBay the latest company accused of tax dodging

by Calum Fuller

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22 Oct 2012

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EBay must pay 38.6m euros to LVMH over the sale of fake branded replicas

ONLINE AUCTION SITE eBay is the latest overseas business to be accused of shirking its fair share in UK taxes.

Customer payments were allegedly routed through Luxembourg in order to lower the company's UK tax bill, according to reports.

eBay's accounts show it took £789m in revenues in 2010. Although it gives no breakdown of its UK profits, its group-wide 23% profit margin suggests it made £181m.

It paid just £1.2m in UK corporation tax that year, however, saving an estimated £50m.

Starbucks, Google, Amazon and Facebook have all been the subject of criticism recently after engaging in tax avoidance by directing profits abroad.

Rising public distaste for the practice has prompted politicians to call for an enquiry into the problem. Members of the Public Accounts Committee will question chief executive of HM Revenue & Customs Lin Homer on the issue on 5 November.

An eBay spokesman said: "eBay in Europe works with tax authorities and complies fully with all applicable tax laws and regimes – including national, EU and internationally recognised OECD rules."

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