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Donald Trump wipes $5.7bn off the value of Amazon with single tweet

Ben Chapman
Updated
Mr Trump has previously criticised Amazon and the Washington Post, owned by Amazon founder Jeff Bezos, for its coverage: NICHOLAS KAMM/AFP/Getty Images
Mr Trump has previously criticised Amazon and the Washington Post, owned by Amazon founder Jeff Bezos, for its coverage: NICHOLAS KAMM/AFP/Getty Images

Donald Trump briefly wiped around $5.7bn off the stock market valuation of Amazon on Wednesday, with a tweet attacking the online retail giant for “doing great damage to tax paying retailers”.

Amazon’s shares lost 1.2 per cent of their value in two hours of pre-market trading after Mr Trump's comments. They regained the lost value after markets opened in New York, trading down up 0.33 per cent by lunchtime.

The President tweeted: “Amazon is doing great damage to tax paying retailers. Towns, cities and states throughout the US are being hurt - many jobs being lost!”

Mr Trump has previously criticised Amazon and the Washington Post, owned by Amazon founder Jeff Bezos, for its coverage. In June, Mr Trump tweeted: “AmazonWashingtonPost, sometimes referred to as the guardian of Amazon not paying internet taxes".

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In December 2015, Mr Trump accused Mr Bezos of using the Washington Post as a tax shelter to reduce Amazon's tax bill. Mr Trump claimed that Amazon’s stock would “crumble like a paper bag” if it could not use this arrangement.

Mr Bezos owns the Washington Post via a holding company which is not linked to Amazon.

The President has repeatedly used his Twitter account to attack individual companies, often causing their valuations to crash temporarily.

Toyota shares plummeted within minutes of a negative tweet in January in which Mr Trump vowed to stop the firm from moving to Baja California in Mexico, causing the company's value to drop by around $1.2bn.

In December, the President took swipes at defence giants Boeing and Lockheed Martin, claiming that both were charging the government too much for their services. Boeing's value fell by more than $1bn, while Lockheed's was down $3.5bn.

However, last week it appeared Mr Trump's power to sway the markets may be lessening after an attack on Merck chief executive Ken Frazier failed to shift the pharmaceutical company's share price.

Mr Trump tweeted: “Now that Ken Frazier of Merck Pharma has resigned from President's Manufacturing Council, he will have more time to LOWER RIPOFF DRUG PRICES!”

Amazon has faced criticism in many countries for the amount of tax it pays. In the US, the Seattle-based company fought for years against collecting sales taxes from customers.

Ten states gave Amazon temporary tax relief in exchange for local investment, according to the National Conference of State Legislatures.

Last week it emerged that Amazon had halved its UK corporate tax liability to just £7.4m despite revenues in the country soaring to over £7bn.

In 2015, Amazon agreed to stop using a controversial structure that allowed all UK sales and profits to be declared through a subsidiary in low-tax Luxembourg after a crackdown by then-Chancellor George Osborne.