Amazon was today told to pay about €250 million in back taxes to Luxembourg, the latest US tech company to be caught up in a European Union crackdown on unfair tax deals.
The fine was much lower than some sources close to the case had expected and is only a fraction of the €13 billion that Apple Inc was ordered to pay to Ireland last year.
EU Competition Commissioner Margrethe Vestager, who has other big US tech companies in her sights, has taken a tough line on multinational companies' approach to tax.
"Luxembourg gave illegal tax benefits to Amazon. As a result, almost three quarters of Amazon's profits were not taxed," Vestager said.
Amazon said it was considering an appeal.
This is about competition in Europe, no matter your flag, no matter you ownership
Though the EU has taken on several US tech companies, both in antitrust and in tax avoidance cases, Vestager said that her approach was not biased against foreign companies
"This is about competition in Europe, no matter your flag, no matter you ownership," Vestager said.
She also welcomed the debate kicked off by French President Emmanuel Macron who called for more integrated corporate tax regimes in Europe, aiming to close the loopholes used to reduce tax bills.
"The Commission's investigation showed that the level of the royalty payments, endorsed by the tax ruling, was inflated and did not reflect economic reality," the Commission said in a statement.
The European Commission also said today that it was taking Ireland to the European Court of Justice for its failure to recover up to €13 billion of tax due from Apple, a move labelled as "regrettable" by Dublin.
More than one year after the Commission adopted this decision, Ireland has still not recovered the money
The Commission ordered the US tech giant in August 2016 to pay the unpaid taxes as it ruled the firm had received illegal state aid, one of a number of deals the EU has targeted between multinationals and usually smaller EU states.
"More than one year after the Commission adopted this decision, Ireland has still not recovered the money," EU Competition Commissioner Margrethe Vestager said, adding that Dublin had not even sought a portion of the sum.
"We of course understand that recovery in certain cases may be more complex than in others, and we are always ready to assist. But member states need to make sufficient progress to restore competition," she added.
The Commission said the deadline for Ireland to implement its decision had been January 3 this year and that, until the aid was recovered, the company continued to benefit from an illegal advantage.
Apple is appealing the case.