In a major victory for Amazon, the European Union’s second-highest court has ruled that the e-commerce giant need not to pay USD 300 million or 250 million euros in the tax bills. The General Court rejected the European Commission order that asked Amazon to pay the amount as taxes to Luxembourg. It must be noted that Amazon has its European headquarters in Luxembourg and the court is also based there. The court rejected claims made by EU regulators that the US tech giant had a selective advantage in the tax deal. “The regulator failed to prove to the requisite legal standard that US company had any illegal tax advantage,” the court concluded.
In a statement issued after the court ruling, Amazon said that the court’s decision proves their stand that they followed all applicable laws and didn’t get any special treatment. “The court’s decision is in line with our long-standing position. European subsidiary of our company abided by all the laws and received no special treatment. We are happy that the General Court has made this clear. Now we can focus on providing services to our customers across Europe.” The case dates back to 2014. The European Commission investigation had concluded that the country granted undue tax advantage to Amazon that benefited the company to the tune of USD 300 million. The case was spearheaded by European Commissioner for Competition Margrethe Vestager.
Vestager said that Amazon was allowed to pay substantially less tax than its competitors. “Because of illegal tax benefits, almost three-quarters of profits of the US company was taxed. In other words, Amazon paid four times less tax than other businesses,” Vestager had said in 2017. She then ordered Luxembourg to recover the money. Two years later, the European Commission launched a formal antitrust investigation against the company. The EU said that Amazon distorted competition rules in online retail markets. But the ruling of the General Court comes as a blow to Vestager. It must be noted that the General Court last year rejected an order that asked Apple to pay USD 15 billion in tax to Ireland.