Luxembourg is one of the most popular tax havens in Europe where companies from across the globe come to create shady tax arrangements. Unfortunately for companies like Amazon, however, the European Union doesn’t like this and actively tries to catch corporations in the act and force them to fork over their unpaid taxes, which is exactly what’s happening to Amazon right now.
Amazon may be receiving an unfair tax advantage in Europe as a result of a 2003 agreement with authorities in Luxembourg that allows the company to shift profits to an untaxed entity in the country, according to the preliminary results from an EU investigation, published this morning. If the findings are upheld by the European Commission, Amazon may be forced to pay millions in back taxes. The probe is part of a larger effort by European officials to investigate corporate tax arrangements in Luxembourg. Other companies, including Starbucks are also under investigation. “Amazon has received no special tax treatment from Luxembourg—we are subject to the same tax laws as other companies operating here,” the company said in a statement.