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EU Opens Formal Investigation Into Amazon's European Tax Practice

The European Union's competition authority is opening a formal investigation of Amazon's European corporate income tax practices.

The European Union's competition authority is opening a formal investigation of Amazon's European corporate income tax practices. Amazon records most of its European profits within the government of Luxembourg. The EU's executive Commission said Tuesday it is reviewing whether a tax agreement between both of them constitutes illegal state aid that could possibly distort competition. The Commission says a 2003 tax arrangement with Amazon EU Sarl ensures that most of Amazon's profits made in the 28-nation bloc 'are recorded in Luxembourg but are not taxed in Luxembourg.' The EU's investigation is part of a wider crackdown on multinationals' ability to avoid taxes by shifting profits and costs between countries. Apple Inc., Starbucks and the financial arm of carmaker Fiat are also under investigation.

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