(Updated with Amazon’s reaction) BRUSSELS, Oct. 7 (Reuters) – The European Commission on Tuesday announced the opening of a full investigation into the taxation of e-commerce giant Amazon Luxembourg investigation The survey covers the favorable terms available to Amazon as part of a tax agreement of 2003, still in force, which capped its imposition in the Grand Duchy and limited the amount of tax to less than 1% of its European revenues. The EC suspects Luxembourg agreeing Amazon artificially allocate revenue between the various entities in the structure in violation of the rules on subsidies to businesses, which has allowed the American Society of slash their tax. “National authorities should not allow specific to artificially reduce their taxable profits by using methods favorable “computing companies, said Joaquin Almunia, Commissioner for Competition, in a statement. “It’s just that multinational subsidiaries pay their share of taxes and do not receive preferential treatment would amount to hidden subsidies.” If the suspicions are confirmed, the EC could ask the Luxembourg to claim from the giant payment of the amounts that have evaporated as well, regarded as state aid illegal. Amazon has reduced its tax bill substantially by making so its US entity, which owns the technology licenses, transfers its revenues to its Luxembourg subsidiary, tax-exempt. The income reported by Amazon in Europe fell in the last two years, despite the sharp increase in sales after a tightening of the rules of the American tax authority (IRS) to fight against the abuses of tax optimization. The group said Tuesday n have entered into any special agreement with Luxembourg. Read more …
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