Amazon wins $270 million tax fight with the EU
On Thursday, the highest court in Europe ruled in favor of Amazon in a legal dispute with the European Commission, which had accused the U.S. e-commerce giant of receiving unlawful tax benefits.
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| Amazon wins $270 million tax fight with the EU |
The genesis of this case traces back to 2017, when the European Commission asserted that Amazon had enjoyed tax benefits in Luxembourg, the site of its European headquarters. In 2017, Amazon was directed to reimburse Luxembourg a sum of 250 million euros (equivalent to approximately $270 million).
After the ruling, Amazon responded with relief, saying in a statement on Thursday: “We welcome the court’s ruling confirming that Amazon followed all applicable laws and did not receive any special treatment.”
Unhappy with the decision, the U.S. technology giant appealed. In 2021, a lower court within the EU sided with Amazon, with the EU’s general court contending that the Commission had not substantiated the existence of an illicit tax advantage granted to Amazon by Luxembourg.
The Commission pursued an appeal, elevating the case to the ECJ, the apex court in Europe. The ECJ's dismissal of the Commission's appeal represents another setback for Margrethe Vestager, the EU's competition chief, who has been actively working to curb the influence of technology companies within the 27 member bloc and challenge certain aspects of their tax practices.
This decision underscores the complexity and challenges associated with regulating technology companies' tax practices within the European Union. The outcome not only affirms Amazon's adherence to applicable laws but also reflects a broader landscape where global tech corporations navigate legal disputes concerning taxation on an international scale.
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