Amazon will increase fees by 2% from September as new ‘tech tax’ goes into effect

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Online retail giant Amazon is expected to increase its seller fees by 2% from September as the UK’s new ‘tech tax’ goes into effect on all items, raising concerns that customers will have to pay more.In a notice to sellers posted on its site this week, Amazon said it has absorbed the cost of the digital services tax since its introduction in the spring, but starting September 1, it will officially go into effect.

The retail giant has said it will increase referral fees, storage fees and handling fees by 2% in the UK to reflect that additional cost.

The move is expected to affect sellers who sign up for Fulfillment by Amazon and send their merchandise to Amazon to store, ship and handle returns, the most difficult.

Payments under this tax are not due until next year.



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Amazon told Mirror Money it has spent the past eight months challenging the tax on the grounds that it would have a bigger impact on consumers than on profits. However, it has now been legislated.

An Amazon spokesperson told Mirror Money: “Like many others, we have encouraged the government to reach a global agreement on taxation of the digital economy at OECD level rather than unilateral taxes. , so that the rules are consistent from one country to another and clearer and fairer for businesses.

“As we stated previously, the way the government has designed the digital services tax will have a direct impact on the businesses that use our services. ”

In March, the UK government confirmed its intention to introduce a digital services tax to collect 2% of online revenue made in the UK by companies such as Facebook, Google and Amazon.

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Although this was not mentioned in the last mini-budget, the government has confirmed that the tax will be introduced on April 1, 2020.

HMRC estimates the tax could result in up to £ 515million in additional annual revenue by the end of the fiscal year ending 2025.

The department explained that the tax will likely affect “large multinational companies whose income comes from providing a social media service, search engine or online marketplace to UK users.”

The main ones will be Facebook, Google and Amazon. US companies have often been criticized for paying very little tax on the large income they generate in the UK.

Companies like Apple, which are expanding into digital services, including entertainment streaming and a credit card, could also be affected.

A similar tax already exists in France, imposing a 3% tax on all companies with global turnover exceeding £ 655million.

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