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Italy Seizes €121 Million from Amazon Unit Over Alleged Tax Fraud

By  |  July 23, 2024

Italy’s tax police have seized approximately €121 million ($131 million) from an Italian unit of eCommerce giant Amazon as part of an ongoing investigation into alleged tax fraud and illegal labor practices, according to documents released by prosecutors on Tuesday.

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    In a detailed 94-page order, the Milan Prosecutors’ Office accuses Amazon Italia Transport, the logistics services unit of Amazon, of circumventing labor and tax laws. The prosecutors allege that the company relied on cooperatives and limited liability companies to supply workers while avoiding VAT tax duties and reducing social security payments. This system, according to the allegations, allowed Amazon to keep its service prices competitive in the Italian market.

    Amazon, however, refuted the allegations, asserting compliance with all applicable laws. “We comply with all applicable laws and regulations where we operate, and require companies who work with us to do the same. We will continue to help the relevant authorities with their inquiries,” the company said in a statement.

    Read more: Amazon Denies Monopolistic Threat in Mexico Amid Regulatory Scrutiny

    The investigation into Amazon Italia Transport is part of a broader scrutiny of large businesses in Italy. Similar probes have targeted other major firms in recent years, including global delivery groups DHL and UPS, German logistics firm DB Schenker, and Italian supermarket chain Esselunga, prosecutors noted.

    These investigations highlight the increasing efforts by Italian authorities to clamp down on tax evasion and illegal labor practices. The outcome of these inquiries could have significant implications for how multinational corporations operate in the country, particularly in terms of their use of third-party labor providers.

    Source: Reuters