The EU snagged US Internet shopping giant Amazon Tuesday in a widening probe into sweetheart tax deals for major multinationals, saying they were unfair to competitors and taxpayers.
The move follows similar probes announced last month into US tech icon Apple in Ireland, coffee-shop chain Starbucks in the Netherlands, and the financial arm of Italian automaker Fiat, also in Luxembourg like Amazon.
Formally, European Union anti-trust regulators will examine if Amazon's tax arrangements with Luxembourg amount to illegal state aid, giving the company an unfair advantage.
But EU Competition Commissioner Joaquin Almunia said the investigation was launched against a backdrop of efforts worldwide to crack down on tax evasion.
"At a time when public budgets are tight, citizens are being asked to make efforts" to help balance public finances, Almunia said.
"In this context, it's important for large multinationals to pay their fair share of taxes," he added.
Almunia said that under a 2003 deal, Amazon recorded most of its European profits through its Luxembourg arm but that these profits were not taxed in Luxembourg.
The European Commission has no jurisdiction over national tax policies - a cherished prerogative of member states - so the probes are strictly limited to rules governing free competition between EU countries.
- See more at: http://digital.asiaone.com/digital/news/eu-snags-amazon-tax-deal-probe-widensşthash.9kSVwA5s.dpuf The EU snagged US Internet shopping giant Amazon Tuesday in a widening probe into sweetheart tax deals for major multinationals, saying they were unfair to competitors and taxpayers.
The move follows similar probes announced last month into US tech icon Apple in Ireland, coffee-shop chain Starbucks in the Netherlands, and the financial arm of Italian automaker Fiat, also in Luxembourg like Amazon.
Formally, European Union anti-trust regulators will examine if Amazon's tax arrangements with Luxembourg amount to illegal state aid, giving the company an unfair advantage.
But EU Competition Commissioner Joaquin Almunia said the investigation was launched against a backdrop of efforts worldwide to crack down on tax evasion.
"At a time when public budgets are tight, citizens are being asked to make efforts" to help balance public finances, Almunia said.
"In this context, it's important for large multinationals to pay their fair share of taxes," he added.
Almunia said that under a 2003 deal, Amazon recorded most of its European profits through its Luxembourg arm but that these profits were not taxed in Luxembourg.
The European Commission has no jurisdiction over national tax policies - a cherished prerogative of member states - so the probes are strictly limited to rules governing free competition between EU countries.
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