Thanks to the new Tax Cuts and Jobs Act (TCJA), Amazon’s federal tax responsibility is 21% (down from 35% in previous years). But with the help of tax breaks, according to corporate filings, Amazon won’t be paying a dime to Uncle Sam despite posting more than $11.2 billion in profits in 2018.
Though Amazon might have taken advantage of new breaks and loopholes available under TCJA, this isn’t the first year that Amazon has avoided paying federal tax. The company reported $5.6 billion in U.S. profits in 2017 and paid $0 last year as well.
What prevents people from doing it today? You can have a Corp to work for Amazon. Amazon pays you 100k, you spend all 100k on living expenses and have a zero profit, thus zero tax no matter what’s the tax rate.
• Extending a global effort to bring global tech giants into the tax net, New Zealand plans to update its laws so it can tax revenue earned by digital firms like Google (GOOG, GOOGL), Facebook (NASDAQ:FB) and Amazon (NASDAQ:AMZN).
• The proposed digital services tax (DST) would tax multinational online companies at about 2 or 3 percent on the revenue they generate in New Zealand.
• A number of other countries including the U.K, Spain, Italy, France, Austria, Australia and India have enacted or already announced plans for a DST.