In the recent turn of events concerning Amazon.com, Inc. (NASDAQ:AMZN)’s Luxembourg tax probe, the European Commission is likely to release details on Friday. The retailer joined the likes of Apple Inc. (NASDAQ:AAPL) and Starbuck Corporation (NASDAQ:SBUX) in October last year as each of these companies are under EU’s scanner for their tax practices.
The primary matter under consideration is whether Luxembourg offered a tax-deal that allowed Amazon to operate with a financial advantage over other market players. In a recent letter from EU, the commission said that retailer received favorable treatment, which might have to be taken back if proven true.
The European Commission mentioned in a document stating preliminary conclusions,
“The Luxembourgish authorities confer an advantage on Amazon. That advantage is obtained every year and ongoing.”
However neither Luxembourg nor Amazon.com, Inc. (NASDAQ:AMZN) have agreed to the accusations.
Luxembourg said that the state was “confident that the allegations of state aid in this case are unsubstantiated and that it will be able to convince the commission in due course of the legitimacy of the tax ruling and that no selective advantage has been granted.” Amazon has released similar statement adding that it doesn’t receive any special tax treatment from Luxembourg and it pays its taxes like the other retailers.
Luxembourg has been on media’s target even since documents indicating substantial tax benefits offered to the companies in Luxembourg were revealed. The state is facing accusations of offering tax benefits to the companies helping them enjoy lower tax rates on their profits.
Earlier, Amazon.com, Inc. (NASDAQ:AMZN) won its first Golden Globe awards on Sunday for its original series ‘Transparent’ and with these awards, analysts are expecting that the retailer would pose bigger challenge to the video streaming service Netflix, Inc. (NASDAQ:NFLX) in near future.
This article has been written by Prakash Pandey.
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