Amazon reaches major settlement in Italian tax and labour probe.
US online retail giant Amazon on Wednesday reached a settlement with Italian tax authorities, under which it agreed to pay €723 million.
The investigation, led by Milan prosescutors, focused on Amazon’s logistics services unit and allegations that the company circumvented Italian labour and tax laws.
This included relying on co-operatives or limited liability companies to supply workers, which allegedly led to the avoidance of Value-Added Tax (VAT) and a reduction in social security payments.
Prosecutors accuse Amazon of failing to collect and remit VAT for certain non-EU third-party sellers on its platform, in contravention of Italian laws.
The probe revealed unpaid taxes totalling €1.2 billion between 2019 and 2021, according to Italian news reports.
Under the settlement agreed on Wednesday, Amazon will pay €511 million to Italian tax authorities in the coming months, in addition to €212 million the company had already paid in recent days to settle a separate tax dispute.
Amazon has denied wrongdoing, stating that the agreement reflected its “commitment to working constructively with Italian authorities”, adding: “We will defend ourselves vigorously against any criminal proceedings, which we believe to be unfounded.”
The company noted that over the past 15 years it has invested more than more than €25 billion in Italy, where it employs more than 19,000 people directly.
Amazon also warned that Italy’s “attractiveness as an investment destination” could be undermined by “unpredictable regulatory environments, disproportionate penalties and protracted legal proceedings.”
