Pandemic fuels subscriber numbers and streaming giant promises to pay more tax
As the stay at home orders hit the UK in 2020, the subscriber numbers for streaming service Netflix soared. More than 2 million new viewers signed up for the service, bringing the total number of customers to around 13 million. These numbers are thought to have brought in an estimated £1.15bn in revenue. They added 36 million subscribers worldwide, meaning they reach more than 200 million across the globe.
Despite this increase, the UK branch of Netflix only paid £4m in corporation tax to the Treasury last year. The monthly fees paid by fans are sent through separate accounts from its headquarters based in the Netherlands. Netflix has begun a shift away from this practice, and in January started declaring its income in the UK to the correct tax authorities.
This may make a huge difference to the amount of tax paid to the UK, but the exact figures won’t be known for a while yet. The amount paid will depend on the profits made before the financial report of 2022. A lot of revenue Netflix earns is ploughed straight back into its expanding British-made production arm. Huge hits such as Bridgerton, Sex Education, and The Crown are all UK-made and thriving.
The UK is the second-largest operation under the Netflix umbrella behind the US. They are looking to add around 120 staff to their team through the course of 2021. With the growing UK market in mind, Netflix acquired the rights to the complete works of Roald Dahl. Containing stories such as James and the Giant Peach, The Witches, and The BFG, it is their biggest content deal to date costing hundreds of millions of dollars.
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