Amazon should not pay €250m in back taxes to Luxembourg
The EU Court of Justice’s Juliane Kokott says the General Court’s judgment annulling the EU decision should be upheld
Luxembourg — Amazon should not pay €250m in back taxes to Luxembourg as ordered by EU competition enforcers, an adviser to Europe’s top court said on Thursday, as she cited errors in the EU regulator's assessment.
In its 2017 decision, The European Commission said Amazon paid no taxes on almost three-quarters of its profits from EU operations due to a Luxembourg tax arrangement allowing it to channel profits to a holding company tax-free.
The EU antitrust watchdog equated the tax deal to illegal state aid. However, a lower tribunal in 2021 scrapped the EU decision, dealing a blow to EU competition chief Margrethe Vestager’s crackdown on preferential deals.
“The commission erred in deciding that Luxembourg had granted unauthorised state aid to Amazon in the form of tax advantages,” advocate-general Juliane Kokott at the EU Court of Justice (CJEU) said in a nonbinding opinion.
"The reference system relied on by the commission in order to review whether there was a selective advantage, namely the OECD Transfer Pricing Guidelines rather than Luxembourg law, was incorrect," she said.
Kokott said the General Court’s judgment annulling the EU decision should be upheld.
The CJEU, which normally follows such recommendations in four out of five cases, will rule in the coming months.
Reuters