Amazon starts paying tax on profits generated from German sales

 Amazon starts paying tax on profits generated from German sales

Global online retailer Amazon.com has started paying tax on profits from its sales to its customers from Germany instead of showing the profits in its accounts in Luxembourg, German national subscription daily newspaper Sueddeutsche Zeitung reported.

According to reports, the change took effect on May 1. In 2014, the European Union (EU) examined Amazon in greater detail. The inspection by EU scrutinized tax deals between Seattle-headquartered Amazon and Luxembourg. As per the investigation by EU, last year the electronic commerce company earned about AU$15 billion from German customers. Amazon has been one of the several large companies that are under the spotlight in Europe over tax deals in Luxembourg and some other places.

There are reports that the EU consumer rights commission has planned to inspect tax practices of Apple in Ireland, Starbucks in the Netherlands and Fiat in Luxembourg in the next round. There could be some other multinational names that will be place under the commission’s microscope, as per the reports.

According to Amazon, the decision has not been taken due to criticism of its practices. “We review our company structures regularly in order to ensure that we can serve our customers as best we can”, Amazon said in a statement.

Some reports have stated that the online retailer has started booking sales in Britain. Earlier, government of Australia announced to introduce a tax on multinational companies that shift profits out of the country. The Australian Taxation Office, under the ‘Google tax’ draft legislation, will get the power to recover unpaid taxes. The United Kingdom passed the original Google Tax legislation which charges about 25% tax on diverted profits.


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