Amazon and Apple have struck in the EU, the turn of the screw the tax


The European Union has launched a fresh crackdown on the taxes paid by the tech giants Amazon and Apple.

Amazon has been ordered to repay € 250 million (£221m; $293m) in back taxes after the European Commission said it had been given an unfair tax deal in Luxembourg.

The Commission expects Ireland to court for its inability to raise €13bn of back taxes from Apple.

Amazon has denied due any tax back, saying that it “receives no special treatment from Luxembourg”.

“We will investigate the Commission of government and to consider our legal options, including an appeal,” a spokesperson for Amazon has said.

But the European Competition Commissioner, Margrethe Vestager, has told the Luxembourg agreement meant that Amazon had been allowed to “pay substantially less in taxes than other businesses”, which it said was “illegal under the EU’s state aid”.

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“Luxembourg gave illegal tax benefits of Amazon. As a result, almost three-quarters of Amazon’s profits were not taxed,” Ms Vestager added.

Said Amazon paid four times less taxes compared to other local companies.

“Member states may not give selective tax benefits to multinational groups that are not available to the others,” he added.

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In the meantime, the Commission has said that it expects to refer Ireland to the European Court of Justice for the non-recovery of €13bn in back taxes from tech giant Apple.

It was concluded last year that the firm’s Irish tax benefits were illegal, to allow the company to pay a tax rate of not more than 1%.

The Commission said that more than a year of this decision, Ireland had not yet recovered the money.

As a result, it was referring Ireland to the Court of Justice of the European union, he said.

Ireland, which has challenged the decision, arguing that the european regulators were interfering with the national sovereignty, said the decision was “very disappointing”.

“Today’s decisions are the order of the Luxembourg to recover taxes not paid by Amazon and see Ireland to the European Court of justice for failure to recover unpaid taxes from Apple. I hope that both decisions are seen as a message that companies must pay their fair share of taxes, as the vast majority of businesses,” said Ms Vestager.Amazon survey

The decision on the Amazon follows a three-year long investigation by the European Commission, who said, in 2014, he had the suspicion that the arrangement had broken the rules of the EU.

The tax deal between Luxembourg and Amazon has been hit in 2003.

The Commission said it had allowed Amazon to move to the “vast majority” of its profits from Amazon EU to Amazon Europe Holding Technologies, which are not subject to tax.

He said that this agreement was “significantly reduced” on Amazon’s taxable profits.

At the time the deal was struck, Jean-Claude Juncker, the president of the European Commission, was prime minister of Luxembourg.