THE British arm of internet shop Amazon was revealed yesterday to have paid corporation tax of less than £10 million last year despite sales of £4.3 billion.

Details of the US firm’s contribution, which were revealed in filings at Companies House, have sparked fresh controversy over its tax arrangements.

Consumers buy from the company’s British website and the items are delivered from warehouses across Britain but the actual payments are mostly to a Luxembourge company called Amazon EU Sarl.

This allows Amazon to legitimately lower its tax bill. It is taxed at the lower rate in Luxembourg and avoids much corporation tax in Britain where the rate is higher.

Amazon says it follows the tax rules in all countries where it operates but Commons public accounts committee chairwoman Margaret Hodge renewed her attack on the company, saying it should pay its fair share of tax.