Alison Flood / theguardian.com
The UK’s bookshops pay 11 times what Amazon does in corporation tax, according to a report from the Centre for Economics and Business Research.
The Bookselling Britain report was unveiled at the Booksellers Association’s annual conference in Birmingham on Tuesday, revealing that bookshops contribute an estimated £540m to the UK economy, and pay an estimated £131m in tax, including £12m in corporation tax. This equates to 91p per £100 of turnover, the report said, which is 11 times the 8p rate that Amazon pays, according to the CEBR. Amazon’s most recent accounts show that Amazon UK Services saw turnover rise to almost £1.5bn in 2016, while corporation tax payments dropped from £15.8m to £7.4m year on year.
The discrepancy was condemned by the Booksellers Association’s Giles Clifton, head of corporate affairs. “The BA has already highlighted the unequal treatment meted out by the business-rates system to British booksellers, the staggering 17 times differential between what the Waterstones on Bedford High Street pays in comparison with the Amazon business unit a short distance away,” said Clifton.
“However, this report helps the BA take this to the next level and to confirm beyond a shadow of a doubt [that] an enormous financial gap exists between what UK booksellers put into the UK, and what Amazon does. At a time when the UK needs to be making the most of her own talents, and utilising all her resources, both cultural, economic, and other, why on earth are we persisting with a policy that is an act of gross self-harm? This stupidity must end.”
The association’s chief executive Tim Godfray added that bookshops were “making an incredible contribution to the UK despite the many obstacles that they currently, and increasingly, face”. But the contribution was “not sustainable unless decisive action is taken by the government to protect them from closure”, he said.
Godfray added: “Bookshops are currently closing at a rate of 3% per year, and 275 towns across the UK can expect to lose their bookshop completely due to changes to business rates if nothing is done. We hope that CEBR’s report encourages our government to act to protect the nation’s bookshops, and enable them to flourish.”
Figures from the BA show that there are currently 867 independent booksellers in the UK, almost half the number that existed 11 years ago. According to the CEBR report, bookshops support 24,400 jobs in the UK, and pay £416m in wages. But they are facing an “increasingly challenging trading environment”, said the report, citing Amazon’s market power and advantages, business rates and corporate taxation as issues that threaten the very existence of Britain’s local and national booksellers.
Speaking at the BA conference, CEBR director Oliver Hogan said that bricks-and-mortar bookshops had a range of advantages that Amazon did not offer, from involvement “with more reluctant readers, helping them to find books they might enjoy”, to the events they put on and the “physical interface” that “can trigger different and unpredictable exploration of themes and topics beyond what was intended”.
Hogan continued: “The Bookselling Britain report highlights the significant direct and multiplier impacts that bookshops have on the UK economy, despite facing numerous challenges. But the benefits to UK communities of local booksellers stretch beyond these monetary impacts, encompassing education, literacy and the provision of an informational and cultural conduit to society at large. All of this feeds technological progress and innovation, the key ingredients in achieving long-term economic growth.”
Clifton added: “It is high time the policymakers in this country woke up and smelt the coffee.”