Yahoo Finance John Lewis Boss Urges Action On Foreign Firm Tax
The managing director of retail chain John Lewis has become the first leader of a British business to call on the Government to examine the way foreign multinationals pay tax in the UK.
Andy Street told Jeff Randall Live exclusively that the Treasury needs to do more to prevent the likes of online retailer Amazon "destroying the UK tax base" and potentially putting British companies out of business.
The comments by Mr Street come amid mounting concern about the tax policies of big international firms in the UK.
This week, Amazon, alongside Google (NasdaqGS: GOOG - news) and Starbucks (NasdaqGS: SBUX - news) , came under fire from MPs (BSE: MPSLTD.BO - news) when it appeared before the Public Accounts Committee.
Mr Street said: "If you actually improve your business by investing ... you have got less money to invest if you are giving 27% of your profits to the Exchequer than, clearly, if you are domiciled in a tax haven and you've got much more.
"They (Amazon) will out-invest and ultimately out-trade us and that means there will not be a tax base in the UK.
"I do think it's an issue that needs to be examined."
Mr Street said the question centres on determining whether earnings made in a particular country are to be taxed in that country.
"Exactly how that happens I don’t know, but that's the principle that needs to be examined," he said.
Asked whether the Treasury should address the Amazon question, Mr Street replied: "I think it should look at exactly what's happening, yes."
Amazon said it used Luxembourg as a base for its European operations because of the favourable tax rate there.
Andrew Cecil, the online retailer's public policy director, said the Luxembourg business' turnover in 2011 was £7.3bn yet it paid taxes of just £6.4m.
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