Most are setup to use a double irish scheme, and usually throw in the dutch sandwich: http://en.wikipedia.org/wiki/Dutch_sandwich

These schemes are relevant to corporate income tax, which can be manipulated and avoided. VAT applies to pretty much all revenue regardless of how you structure your company ownership structure.

Reminds me of the nice Starbucks joke from last week:

I like my women like I like my coffee - paying tax on their income in the UK.

There's a twist in asking customers to pay 20%, and taking that from the authors, and then (according to GP) not paying the 20% in England but paying just 3% in some other country.

VAT is not the same as corporation tax.

In the UK, Amazon is being accused of not paying the full amount of corporation tax they ought to be paying.

This sounds fraudulent.

You can be quite sure that the contract is not phrased in such a way that Amazon is required to pay 20% VAT on the ebooks in question to the UK government.

Is it sleazy as all getout? Yup, absolutely: but it's not illegal. Companies pull this kind of bait and switch all the time when they think they can get away with it. Remember when Microsoft bought the original Internet Explorer codebase in return for the company in question receiving a cut of the profits and then gave it away for free? How they must have laughed about that one back at MS HQ...

In reality, the publishers handed Amazon a near monopoly on ebook sales by their own short-sightedness and now Amazon is turning the thumbscrews to see how much they're actually prepared to cough up. The games with VAT in the contract are just part and parcel of that.

> How they must have laughed about that one back at MS HQ...

Until they lost the lawsuit...

http://www.windowsitpro.com/article/news2/microsoft-and-spyg...

Vodaphone's shenanigans so they only paid £1.2bn of the estimated £6bn total tax bill also sounds well dodgy.

It's funny that then people give out about small countries that have lower coporation tax (e.g. Ireland). If companies in "non-low-tax" countries like UK don't pay any tax, why give out to low-tax countries?

Not that taxes are out of control in the UK or anything...

Elaborate please?