Hot on the heels of Apple’s tax woes in Europe, news has emerged that Amazon is next in the firing line for the European Commission (EC).

As the Financial Times first reported, the EC is preparing to launch a probe into allegations that Luxembourg, where Amazon’s EU headquarters is based, enabled the e-commerce giant to illegally benefit from state subsidies.

The FT said:

“Investigators believe Luxembourg gave Amazon favourable terms in a 2003 tax ruling, which caps its tax exposure to the Grand Duchy and helps limit its overall bill to less than 1 per cent of the retailer’s European income, according to people briefed on the case.”

The EC has now confirmed that it is launching an investigation into Amazon’s tax exploits.

Related read: Amazon’s e-book tax loophole could mean lower European prices, but that’s bad for UK competition

➤ Brussels targets Amazon’s Luxembourg tax deal [FT]

Thumbnail image credit – EMMANUEL DUNAND/AFP/Getty Images

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