Brussels: Amazon.com Inc. faces an in-depth European Union probe over a tax deal with the Luxembourg authorities as soon as on Tuesday, according to a person familiar with the investigation.
The European Commission suspects Luxembourg broke EU rules on state aid with a 2003 ruling giving Amazon assurances on how some of its income would be taxed, said the person who asked not to be identified because the details of the probe aren’t public.
The EU inquiry into Amazon comes amid a global crackdown on corporate tax-avoidance as governments struggle to increase revenue and reduce deficits. It expands a probe into Apple in Ireland, Starbucks Corp. in the Netherlands and Fiat Finance & Trade in Luxembourg. The commission has said tax avoidance and evasion in the EU cost about €1 trillion ($1.3 trillion) a year.
Luxembourg hasn’t provided any detail about any expiry date for that tax ruling, the person said. The Brussels-based commission has the power to ban and order recovery of selective public subsidies, including tax advantages, that distort competition.
Joaquin Almunia, EU’s antitrust commissioner, is scheduled to make an announcement on an unspecified case at noon Brussels time, according to an e-mailed statement.
Representatives for the commission declined to comment. Luxembourg’s finance ministry and Amazon didn’t respond to requests for comment.
The Financial Times reported earlier on the Amazon case. Bloomberg