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Europe has ordered Amazon to pay nearly $300 million in back taxes

The e-commerce giant is considering an appeal

Jeff Bezos being interviewed by Walt Mossberg at the 2016 Code Conference
Jeff Bezos at the 2016 Code Conference
Asa Mathat

The European Union ordered Luxembourg on Wednesday to recoup around 250 million Euro in back taxes from Amazon, following a three-year investigation into a special tax deal that dates back to 2006.

The decision handed down by by Margrethe Vestager, the EU’s leading antitrust regulator, amounts to about $294 million.

“Luxembourg gave illegal tax benefits to Amazon,” Vestager said in a statement. “As a result, almost three quarters of Amazon's profits were not taxed. In other words, Amazon was allowed to pay four times less tax than other local companies subject to the same national tax rules.”

An Amazon spokesperson issued a statement saying the company believes “Amazon did not receive any special treatment from Luxembourg and that we paid tax in full.”

“We will study the Commission's ruling and consider our legal options, including an appeal,” he added.

For Amazon, the size of the tax payment still would amount to essentially a slap on the wrist. The company generated a nearly $2.4 billion profit on $136 billion in revenue in 2016 alone.

For Vestager, the ruling is only her latest swipe at the U.S. tech industry. In recent years, she’s led the region’s numerous antitrust investigations of Google, most recently slapping the company in June with a record 2.4 billion Euro fine for the way it handles shopping search results.

Vestager has also focused on tax breaks that European Union countries have handed out to large, multinational corporations. In 2016, she penalized Apple 13 billion Euros on grounds that it benefitted from preferential tax treatment from Ireland. On Wednesday, Vestager said she was taking Ireland to court for failing to make progress on recouping the money.

In the case of Amazon, the commission argues that a 2003 tax ruling by Luxembourg — that was extended in 2011 — allowed Amazon to pay out royalties from one of its entities to another to take down its tax bill.

In the Apple case, the Obama administration publicly came to the company’s defense. The Trump administration, for its part, reportedly filed in Europe to intervene’s on Apple’s behalf much more quietly this July.

It is unclear if the U.S. government might lend similar support to Amazon in the coming months. Keep in mind: President Donald Trump himself repeatedly has slammed the e-commerce company, even accusing Bezos of purchasing The Washington Post as a tax-dodging scheme.

This article originally appeared on

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