Italian authorities are conducting an inquiry into e-commerce giant Amazon. Three of its senior team members are suspected of evading taxes in the country amounting to €1.2bn ($1.26bn).
Initial reports of the probe surfaced in 2024, but Reuters reports that the full scope of the investigation only became apparent following a report by Italian newspaper Corriere della Sera.
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Amazon stated: “[We are] committed to complying with all applicable tax laws”, and highlighted its significant tax contributions in Italy, noting that it ranks among the top 50 tax payers in the country, with its 2023 tax bill surpassing $1.4bn.
Milan prosecutors and tax police have targeted the Luxembourg-based European arm of Amazon and three of its managers.
The allegations pertain to online sales in Italy between 2019 and 2021.
According to the sources, financial repercussions for Amazon could escalate to €3bn when including potential penalties and interest.
Central to the investigation is Amazon’s algorithm, which allegedly facilitates sales in Italy by non-EU sellers, predominantly Chinese, without revealing their identities.
This lack of transparency reportedly aids these sellers in evading Italian value-added tax (VAT).
Intermediaries such as Amazon are legally held co-responsible for VAT non-payment by non-EU sellers on their platforms under Italian law, so this could have severe implications for Amazon’s operations throughout Europe.
The inquiry began in 2021 following routine inspections by tax officials north of Milan. A separate case from July 2024 has also been referenced by a source.
Italian tax police have seized €121m from an Amazon subsidiary in Italy amid allegations of tax fraud and illegal labour practices.
Amazon expanded its footprint in Europe with the opening of its first physical retail space in the centre of Milan, Italy on 12 February 2025.
