Yet another report has surfaced in the UK suggesting Netlix is under paying local corporate taxes.
The Cardiff-based Companies House, the United Kingdom's registrar of companies, said that Netflix only paid £3.2 million ($4.37 million) in UK corporation tax in 2019 against revenue of £120 million ($164 million). Netflix declared declared pre-tax profits of £13 million ($17.76 million) in 2019, the group added. The data was originally published by The Guardian.
It’s the second time in recent months that Netflix has come under fire for allegedly underpaying taxes in Britain.
In November, local advocacy group Tax Watch said that Netflix reported 2018 revenue of just $57 million in the UK, while the org tallied its actual revenue at closer to $1.1 billion.
“As Netflix continues to grow in the U.K. and in other international markets we want our corporate structure to reflect this footprint,” a Netflix spokesman told The Guardian at the time. “So from next year, revenue generated in the UK will be recognized in the U.K., and we will pay corporate income tax accordingly.”
Netflix’s UK accounting is complicated. The company operates in the region through a holding company called Netflix Services UK, which also also provides services to Netherlands-based Netflix International.
And Netflix’s UK business isn’t just about streaming video to homes. As Variety noted, Netflix is investing heavily in U.K. production, and is now spending as much as $1 billion in this operation, producing successful shows like The Crown and Sex Education in the region.
The Netflix tax data comes as the Organization for Economic Cooperation and Development (OECD), an intergovernmental group, is considering proposals to reduce tax avoidance by multinational companies.
Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!
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