Amazon wins tax fight with EU for $270 million

Amazon wins tax fight with EU for $270 million

Europe’s highest court has sided with Amazon in a high-profile case in which the European Commission accused the e-commerce giant of receiving illegal tax benefits in Luxembourg. This is reported by CNBC.

The Court of Justice of the European Union (ECJ) said that the European Commission, the EU’s executive body, “did not install”, that the tax agreement between Amazon and Luxembourg was “state aid incompatible with the internal market”.

“We welcome the court’s decision, which confirms that Amazon followed all applicable laws and did not receive special treatment.” – says the company’s statement.

The case dates back to 2017, when the European Commission alleged that Amazon received tax advantages in Luxembourg, where its European headquarters are located.

In 2017, Amazon was ordered to return €250 million (approximately $270 million) to Luxembourg.

The American technology giant appealed this decision. In 2021, a lower EU court sided with Amazon, as the EU General Court said the Commission had failed to prove that Luxembourg granted illegal tax advantages to Amazon.

The Commission then challenged this decision, referring it to the Court of Justice of the European Union, Europe’s highest court.

The European Court rejected the appeal. It was another blow to EU competition chief Margrethe Vestager, who has been trying to rein in the power of tech companies operating in the EU and challenge some of their tax practices.

Note that this is not the first such court case. In 2016, the European Commission ordered Ireland to collect €13 billion in back taxes from Apple. In 2020, Apple won an appeal to stop paying those refunds. The Commission is now appealing the said decision. The EU Court may also have the last word in this case.

ProIT previously reported that Amazon is suing the REKK fraud gang, which stole millions of dollars through an illegal kickback scheme.

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