One of the great reverse ferrets in the newspaper industry is how the change from Dacre to Grieg has led to the Daily Mail becoming anti-Brexit rather than the previous rather vociferous pro-. Which does seem to be causing a little misunderstanding on certain of the reporting desks.
Here we’ve a complaint that Netflix is selling some vast amount in the UK, reporting little revenue, less profit and near no profits tax. Well, yes, it is, but why?
Netflix Services UK Limited – the company’s British subsidiary - employed only 14 people at its London office by the end of December, according to its most recent accounts.
Its British arm declared revenues of £23.9m (26.9 million euros) and pre-tax profits of £1.12million (1.27 million euros).
Netflix’s standard package for British users offers unlimited streaming for £7.99 a month. If the company’s 9 million subscribers pay around this much per month, Netflix makes £71.9million from its British subscribers each month. This works out to be around £863m each year.
HMRC could be looking into the transfer pricing deal between the British arm and its Dutch parent, which determines the amount of revenues that Netflix reports in the UK. Netflix did not explain why HMRC was examining its tax arrangements.
It’s not actually necessary for there to be any transfers, let alone abuse of transfer pricing rules, for this situation to happen or to be legal. All we need is the European Union’s own Single Market.
Any EU company, registered, domiciled and sitting in any EU country, may sell in any other EU country. And be taxed where it is registered, domiciled, sitting. Which is what is being done. Not allowing this would mean leaving the Single Market.
So, how’s the Mail’s opposition to Leave working now?