Amazon wins $ 303 million in court battle with EU tax blow to Crusaders

Brussels — Amazon with EU order to pay Luxembourg a refund tax of around € 250 million ($ 303 million) in another blow to the Crusaders against competition chief Marguerite Vestager’s priority deal I won the battle.

The block could not show that Luxembourg had given special treatment to US online retailers in violation of national aid rules, the EU court of first instance ruled Wednesday.

The victory follows Vestager’s groundbreaking defeat against Apple last year, with Apple challenging the order to pay € 13 billion ($ 15 billion) in Irish refund taxes.

Both Amazon and Apple have been targeted by Vestager in a campaign to end tax transactions used by EU member states such as Ireland, Luxembourg and the Netherlands to attract large corporations. The Commission considers such agreements to be unfair.

“The European Commission did not prove to the required legal standards that the tax burden on Amazon Group’s European subsidiary was excessively reduced,” said a Luxembourg-based EU judge.

Amazon welcomed the ruling in a statement, stating that it was in line with “a long-standing position that it complied with all applicable laws and that Amazon was not treated specially.”

Marguerite Vestager of the European Competition Commission
The European Commission’s Marguerite Vestager will hold a press conference on October 4, 2017 at the EU Commission headquarters in Brussels. (Francoire Noir / Reuters)

Mr Vestagger said he would consider the decision before deciding whether to appeal to the European Supreme Court.

Not all bad news for Bestagger. In another case on Wednesday, French utility Engie lost its appeal against the EU’s order to repay a tax of € 120 million ($ 145 million) on Luxembourg.

But the spotlight was on Amazon’s decision criticized by a group campaigning for higher taxes on multinationals.

“Today’s ruling is a blow,” said Chiara Putaturo, a tax expert at Oxfam EU. “Case-by-case investigations again show that large-scale tax avoidance does not resolve.”

Amazon’s decision was small compared to the billions of dollars online retailers earn each quarter, but the decision could help other companies appeal against Block’s tax audit. there is.

Vestager has succeeded in changing tax practices in Belgium, Ireland, Luxembourg and the Netherlands, spurring the Organization for Economic Co-operation and Development (OECD) to seek global trading on how multinational corporations tax.

The OECD said last week that global trading potential was higher than ever.

In a 2017 ruling knocked down by the European Commission on Wednesday, Luxembourg will pay taxes on nearly three-quarters of profits from EU operations by allowing profits to be sent tax-free to holding companies. Said he escaped the Amazon.

The EU said in its 2018 Engie decision that an arrangement with the Luxembourg authorities has artificially reduced the company’s tax burden. This means paying an effective corporate tax rate of 0.3% for certain profits in Luxembourg for approximately 10 years.

The court upheld the Commission, stating that French utilities benefited from tax incentives.

The cases are the T-816 / 17 Luxembourg v Committee and the T-318 / 18 Amazon EUv Committee.

Fu Yun Qi