Amazon UK paid just £4.2 million in tax - time to scrap corporation tax completely

A report in the Guardian today says that Amazon UK paid just £4.2 million in tax last year, despite selling goods worth £4.3 billion.  The report goes on to day that this "brings to just over £10m its contribution to the public purse through corporation tax in a decade. Over the last four years, Amazon has generated £23 billion in British Sales".

For me, the solution is simple. Governments should offer to abolish corporation tax everywhere in the EU. But in exchange, we should introduce a tiny Financial Transaction Tax on all electronic transactions.

In the UK, corporation tax raises just under £40 billion a year. That number is about 0.002% of the level of UK financial transactions (over £1840 trillion).

Similarly, in France, the "Impôts sur les sociétés" generated €39 billion in 2011. While transactions in France are a lot lower than in the UK (I got a total of €273 trillion from the BIS figures for 2012), it would still be possible to replace the Impôt sur les sociétés by an FTT of just 0.014%.

And, of course, the best thing would be for all Central Banks to fix an FTT on all transactions in their currency - wherever they occur in the World. That way, it wouldn't matter whether the euros were being used for trades in Paris, Frankfurt, London, New York or Singapour - the ECB would recover the tax payments and could distribute the money between the 18 Eurozone countries simply on the basis of relative population size.

As you are probably aware, I would like to scrap not just Corporation Tax, but also Income tax, VAT and a whole pile of other pointless taxes. But, strategically, it may be a good plan to offer to scrap Corporation taxes first. That way there would be very strong backing from business, and this would help get the FTT idea through the door.....