The 250 million euro lawsuit is finally settled! The EU is crying, Amazon is laughing

According to foreign media reports on Wednesday evening, the much-talked-about Amazon tax evasion case in Europe has finally come to an end. A judge at the European Court of Justice in Luxembourg ruled that the European Commission could not provide sufficient evidence to prove that Amazon's Luxembourg subsidiary evaded paying taxes, and thus cancelled the 250 million euros in tax repayments calculated by the European Commission and did not punish Amazon .

Since then, Amazon has breathed a sigh of relief, and Luxembourg's Ministry of Finance no longer has to worry. An Amazon spokesperson said: " We strongly support the court's decision, which is consistent with our long-standing view that we always comply with all applicable laws and Amazon does not enjoy any special treatment ."

It is reported that the case can be traced back to 2003 , when Amazon just established a company in Europe and the US headquarters set up a special holding structure in Europe : two European subsidiaries located in Luxembourg were responsible for the so-called intangible assets , namely intellectual property rights, the retail company's technology and customer data .

In return, Amazon had to pay fees to its European parent company . However, in order to tie itself to Amazon, Luxembourg granted Amazon anti-competitive advantages between May 2006 and June 2014 , stipulating that 75% of Amazon's revenue in the EU could be tax-free, and extended the deadline for the resolution in 2011.

There is no such thing as a wall that is impenetrable. In 2017, the European Commission found out through investigation that Amazon Europe had evaded 250 million euros in taxes over eight years by using this clause , and immediately issued a ban on Amazon.

Now, the case has finally come to a close. The European Commission thought it could use this case to crack down on tax dumpers , but the verdict shattered their hopes, which is a major blow to the EU competition watchdog . Green Party MP Sven Giegold concluded in a statement : Our existing laws are not enough to ensure tax justice .

The issue of whether Amazon is entitled to preferential tax benefits has recently reached a turning point. The reason is that Amazon announced its 2020 financial report, setting a sales record of 44 billion euros, but its 2020 annual financial report showed a loss of 1.187 billion euros. As a result, Amazon received a tax exemption of 56 million euros , achieving zero tax. This matter has sparked heated discussions outside.

European Parliament member Giegold called for fair tax rules to be established in Europe . They placed great hopes on US President Biden, an advocate of fair competition . Biden has previously called for a global minimum tax of 21% on companies , which would bring about 400 billion euros in additional revenue to global governments .

The ideal is full, but the reality is very skinny. The realization of fair tax rules is very troublesome, and there is also fierce controversy within the EU on this proposal. First, governments must agree that profits should be taxed where they are generated , so that there is no possibility of cross-border transfer; in addition, companies must be honest and transparent in disclosing income information. This sounds like a pipe dream.

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