The EU Commission has sent Internet Mail-order distributor Amazon to a tax repayment of 250 million euros. It accuses group of having benefited from unfair tax advantages in Luxembourg since year 2003. As a result, group had to pay much less tax than or companies. According to EU state aid rules, targeted tax advantages are inadmissible for individual companies.
With its decision, Competition Commissioner Margre Vestager puts US group in a row with companies such as Fiat, Starbucks and Apple, against which it has already imposed payments in similar cases. Particularly high was fine that Apple had to pay last year: iphone manufacturer must pay 13 billion euros, plus interest. Apple is said to have paid only 0.005 percent of taxes, using a sophisticated construct in Ireland.The punishment is also unpleasant for Jean-Claude Juncker
The now imposed penalty against Amazon is not only unpleasant for mail-order merchant, but also for EU Commission President Jean-Claude Juncker. The latter, as prime Minister of Luxembourg, had negotiated that Amazon would come to Grand Duchy. He is also considered one of architects of Luxembourg tax haven.
The investigation against Amazon was launched by EU Commission three years ago. In a preliminary ruling, she stated a few months later that model used by Amazon was illegal. Luxembourg n sent documents to Brussels, which were to be discharged from accusation. However, Commission has confirmed suspicion that Amazon's tax-saving model is not compatible with EU law.
In particular, Commission is disturbing money flows at Amazon. The profits generated by company in Europe have been concentrated in "Amazon EU Sàrl" for years. The daughter is based in Luxembourg, i.e. in EU. However, it led large portions of its profits to American subsidiaries-on a dubious basis from EU Commission's point of view.The Apple tax is doomed to fail Europe's states see almost nothing of billions that US internet corporations like Apple, Google or Facebook earn here. However, a special tax will not change it. Comment by Ulrich Schäfer more...