The tech giant, which typically only reveals tax payments for certain countries, said that it spent $431-million in payroll and corporate taxes in 2021
In recent years, the Organization for Economic Co-operation and Development has been pushing for the world’s biggest companies to more fairly distribute their corporate tax income to jurisdictions where they operate. Infound that Amazon had for years structured its Canadian retail business in such a way that certain profits could be booked in the United States.
That strategy required many senior retail employees to conduct minimal business in Canada, as they limited the amount of their time spent north of the border and signed any documents back on American soil. Amazon told The Globe last year that it no longer employed the exact strategy its reporters had found in an internal playbook, but did not clarify how its approach to profit and taxation in its retail division had changed.
It also does not break down the taxes that were attributable to its different divisions, meaning it is impossible to separate how much was incurred by the retail operations versus the Amazon Web Services cloud segment – which in fiscal 2021 was responsible for US$18.5-billion or 74 per cent of the parent company’s global operating profit.
The Globe investigation found, as recently as in the past six years, the tech giant’s warehouse network in Canada was run by a B.C.-registered company called Amazon Canada Fulfillment Services while retail operations were led separately through a subsidiary at the head office in Seattle. Nothing The Globe uncovered suggested illegal practices, such as tax evasion, but the strategy could effectively shield one of Canada’s largest merchants from having retail profits taxed by Ottawa.
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