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Amazon is set to slapped with a tax fine worth hundreds of millions of euros, in the EU’s latest clampdown on tech companies. According to the Financial Times, Amazon will receive the fine today in relation to unpaid back taxes. It is likely to be the first of many fines handed out to tech giants in accordance with new tax rules to prevent US firms from skirting EU tax laws.
The European Commission’s move comes on the heels of Apple’s record €13billion bill for Irish back taxes last year, which prompted a fierce political backlash from Washington. However, the EU has remained true to its word and continues to go after US conglomerates.
The investigation into Amazon was launched almost three years ago. The European Commission’s investigation alleged that the US online retailer benefited from a sweetheart tax deal that granted it almost a decade of illegal state support from Luxembourg.
The case against Amazon is the fourth of about half a dozen tax probes launched by the commission since 2013. Decisions have been taken against Apple in Ireland, Starbucks in the Netherlands, and Amazon and Fiat in Luxembourg, while Belgium separately was required to recover tax from about 35 companies benefiting from an illicit scheme.
It is believed that around €3 billion worth of taxable earnings was not formerly declared by Amazon, leaving hundreds of millions in unpaid taxes. The fine will be handed out later today and is another clear warning to US tech giants that they are not untouchable.
