Pandemic profiteers face tax hike on Covid winnings
Companies that have cashed in a result of the coronavirus pandemic, including the likes of Amazon, will face a double tax raid under plans being draw up by the government.
The government has summoned companies to discuss how an online sales tax would work, while plans are also being drawn up for a one-off “excessive profits tax,” the Sunday Times reported.
The move is in an attempt to plug the black hole in Britain’s finances, with Covid-19 having cost the government more than £271bn.
Finance minister Rishi Sunak is unlikely to announce the taxes at the budget announcement scheduled for March 3, which will focus on an extension of the Covid-19 furlough program and support for businesses. Instead, the tax hike is instead likely to surface in the second half of the year.
Sunak faces pressure from some in the Conservative party to show spending is under control when he presents a new budget, after what is on track to be the heaviest annual borrowing since World War Two.
He has promised to put public finances on a sustainable footing once the economy begins to recover.
The finance ministry was not immediately available for comment on the Sunday Times report.
Amazon’s sales in Britain leapt by 51 per cent last year to £19.5bn as those in lockdown became more reliant on home deliveries. But the company pays little corporation tax — just £14.5m in 2019.
Firms likely to be hit by a one-off Covid windfall tax include online retailers such as Amazon and Asos, food delivery firms such as Ocado, Just Eat and Deliveroo, and parcel firms and the big supermarkets.