Europe

Amazon wins EU court appeal in Luxembourg tax case

An EU Court said on Wednesday that the Commission failed to prove that Amazon was granted an illegal tax advantage, annulling the EU Executive’s decision that accused Luxembourg of handing the US retail giant about €250 million in tax benefits that amounted to illegal state aid. 

In 2017, the Commission concluded that Luxembourg granted illegal state aid to Amazon, declaring the aid incompatible with the internal market. However, the EU court supported that the Commission’s findings were based on an analysis “which is incorrect in several aspects.”

“The General Court concludes that none of the findings set out by the Commission in the contested decision are sufficient to demonstrate the existence of an advantage for the purposes of Article 107(1) TFEU, with the result that the contested decision must be annulled in its entirety,” reads the court’s ruling

The decision by the General Court of the European Union marked another major blow the bloc’s competition chief, Margrethe Vestager, as in July it had ruled that the EU antitrust authority had failed to prove that the Irish government had given a tax advantage to Apple.

Reacting to the EU court’s ruling, Vestager said in a Twitter post that “Ensuring all companies pay a fair share of tax is a marathon not a sprint,” adding that the EU Executive will analyse Wednesday’s judgements.

“Both confirm State aid rules apply & selective tax benefits harm fair competition,” her post further reads, whilst stressing that the EC will “keep working, also to seize momentum to update” the bloc’s tax laws.

An official statement issued by the Commission also noted that the body is “close to achieving a historic global agreement” on the reform of the international corporate tax framework. 

Welcoming the ruling, Amazon said it is “pleased that the Court has made this clear,” and that it can “continue to focus on delivering for our customers across Europe.”

“We welcome the Court’s decision, which is in line with our long-standing position that we followed all applicable laws and that Amazon received no special treatment,” Amazon said in a statement, Reuters reported. 

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