Amazon to be slapped with million-euro fine by EU for tax avoidance

The EU is gearing up to hit ecommerce giant Amazon with a multi-million euro bill for unpaid taxes related to its operations in Luxembourg, The Financial Times reported on Tuesday.

The move from the European Commission would represent its latest attempt to crack down on the tax practices of major multinationals, having launched major action against the likes of Apple and Google in the last year.

Citing people familiar with the case, the FT said an investigation into the Seattle-based tech giant has concluded that it received favourable tax deals in the country, where its European operations are based.

In 2004, Amazon launched its ‘goldcrest’ project, where it restructured its European operations to move its intellectual property into a non-taxable partnership in Luxembourg.

Competition commissioner Margrethe Vestager is the official leading the charge against the US giants.

The commission ruled last year that Ireland had given Apple an unfair tax rate in its dealings in the country, a decision which is facing appeal from both the state and the company.

The appeals process from Apple and Ireland is underway, and is likely to take several years to reach its conclusion. Last August the commission found a tax benefit of $13bn had been given to the iPhone maker from the Irish government.