Amazon, Apple hit in EU tax crackdown

BRUSSELS: The European Union has launched a fresh crackdown over taxes paid by tech giants Amazon and Apple, a media report said on Wednesday.

Amazon was ordered to repay 250 million euros ($293 million) in back taxes after the European Commission said it had been given an unfair tax deal in Luxembourg, the BBC reported.

The Commission also plans to take Ireland to court over its failure to collect 13 billion euros of back taxes from Apple.

Amazon denied it owed any back tax, saying it did “not receive any special treatment from Luxembourg”. “We will study the Commission’s ruling and consider our legal options, including an appeal,” an Amazon spokesperson said.

But European Competition Commissioner Margrethe Vestager said the Luxembourg arrangement meant that Amazon had been allowed to pay “substantially less tax than other businesses”, which it said was “illegal under EU state aid rules”.

“Luxembourg gave illegal tax benefits to Amazon. As a result, almost three-quarters of Amazon’s profits were not taxed,” Vestager added. She said Amazon paid four times less tax than other local companies.

“Member states cannot give selective tax benefits to multinational groups that are not available to others,” she added.

Meanwhile, the Commission said it planned to refer Ireland to the European Court of Justice for failing to recover 13 billion euros in back taxes from Apple.

It concluded last year that the US firm’s Irish tax benefits were illegal, enabling the firm to pay a corporate tax rate of no more than 1%.