Amazon hit by multi-million tax bill in Europe

Amazon staff go about their day.

James Martin/CNET

Amazon has been slapped with a bill for 250 million euros (about £220 million, $294 million or AU$370 million) of unpaid taxes in Europe. 

The online giant was found by the European Commission to have an illegal deal with Luxembourg since 2003, which allowed the US company to move money between its subsidiaries so profits were taxed there instead of a country with a higher corporate rate. 

“Almost three quarters of Amazon’s profits were not taxed,” said European Commissioner Margrethe Vestager in an official statement. “Amazon was allowed to pay four times less tax than other local companies subject to the same national tax rules. This is illegal under EU State aid rules. Member States cannot give selective tax benefits to multinational groups that are not available to others.”

An Amazon spokesperson told CNET the company disputes the allegation of special treatment from Luxembourg, and will consider an appeal.

Amazon shouldn’t have any problem stumping up the cash, having turned over revenue of $35.7 billion in the first quarter of 2017 alone. However, it is the latest example of the European watchdogs going after tax avoidance by US companies, which last year saw Apple asked to pay back a whopping 13 billion euros in back taxes. That’s around £11 billion, $14.5 billion or AU$18 billion. 

Amazon has yet to respond to a request for comment.

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