Amazon is the latest tech giant caught in an EU tax deal gone bad

Amazon.
(Image credit: LOIC VENANCE/AFP/Getty Images)

Amazon is about to write quite a hefty check.

On Wednesday, the European Union ordered Amazon to pay 250 million euros in back taxes — that's $295 million — to Luxembourg, citing an unfair tax deal between the tech giant and the tiny country where its headquarters are located. EU Competition Commissioner Margrethe Vestager said an illegal deal between Amazon and Luxembourg meant nearly three-quarters of Amazon's profits weren't taxed.

Amazon is just the latest U.S. tech company to be charged in a series of European Union investigations into multinational tax deals. Last year, Apple had to pay Ireland 13 billion euros in back taxes.

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE
https://cdn.mos.cms.futurecdn.net/flexiimages/jacafc5zvs1692883516.jpg

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The EU says tax agreements like Amazon's let multinational companies protect EU profits from taxes, Reuters explains. Luxembourg and other small European countries are all facing EU scrutiny for these kinds of tax deals, including ones with McDonald's and Fiat.

Despite making out better than Apple, Amazon said it is considering appealing the decision.

Continue reading for free

We hope you're enjoying The Week's refreshingly open-minded journalism.

Subscribed to The Week? Register your account with the same email as your subscription.