What is Amazon’s contribution to the French economy? The American company stigmatized for its (legal) tax optimization practices lifts the veil on its activity in France and especially on the taxes it pays to the tax authorities.
In 2021, Amazon continued to grow strongly in France. The French subsidiary announces that it has reached a turnover of 9,000 million euros, that is, a spectacular increase of more than 23% compared to 2020. The American e-retailer is now the eighth French distribution brand and the first in products non-food ahead of Leroy-Merlin and its 7.9 billion euros in 2021.
The company estimates the total amount of its tax bill in 2021 at 1,000 million euros, a sum that has been increasing considerably in recent years. Amazon France had paid €250 million to the French Treasury in 2018, €420 million in 2019 and €600 million in 2020. Amazon now estimates that it is among the top 100 French companies for its tax contribution according to a ranking prepared by Deloitte.
Always present optimization
If the sum of a billion is large, add all the contributions from Amazon. Be it VAT, taxes on production (CVAE, CFE), local taxes, corporate tax (IS) but also employer contributions. The only direct contributions last year represented 470 million euros compared to 310 million the previous year. Therefore, most of Amazon’s tax bill is made up of indirect taxes (paid by customers) such as VAT.
It’s also impossible to tell if Amazon has ended its optimization practices when it comes to corporate income tax. The firm does not give details of its direct tax contribution. Amazon can therefore, despite a turnover of 9 billion euros, not declare any profit and thus be exempt from IS. To get around the latter, the company, like many other US companies, charges foreign subsidiaries services called “transfer fees” to minimize its locally earned profits.
In 2021, the European subsidiary of the Luxembourg-based e-commerce giant was exempt from corporate tax despite a turnover of €51.3 billion. But an Amazon spokesman interviewed by Bloomberg says the company “pays hundreds of millions of euros worth of corporate taxes across Europe.”
Salary increases of 3.5%
Unlike many American tech companies, Amazon has a significant presence in France with its dozens of warehouses and thousands of employees. Its fiscal contribution is therefore mechanically much greater than that of a Facebook or a Google.
Amazon also highlights its contribution in terms of jobs. If the company employs 18,500 employees, it also contributes to generating activity with its marketplace, which represents 55% of its turnover, or 11,000 million euros in 2021.
Therefore, there are 13,000 French third-party sellers who are present on Amazon in France. Last year they achieved 1.95 billion euros in sales, or 150,000 euros on average per company. Obviously all of them are far from being so successful since only 20% of their SMEs get more than 100,000 euros in turnover thanks to Amazon and only a hundred more than 1 million.
Regarding working conditions within the company, Amazon again wants to respond to criticism. While entire sectors of the French economy are struggling to recruit, Amazon says there is no shortage of candidates.
Source: BFM TV
