Milan prosecutors have asked for Amazon’s European unit and four of its managers to stand trial for alleged tax evasion totaling about 1.2 billion euros ($1.38 billion). This move is unusual because Amazon already settled a tax dispute with Italy by paying 527 million euros in December.
Normally, once a company settles a tax dispute and pays up, prosecutors close any related criminal investigations. But this time, Milan prosecutors are going ahead with their case, despite the settlement.
Amazon was not immediately available for comment. After the settlement, the company said it would “forcefully defend its position on the potential ungrounded criminal case.” Amazon also mentioned that “unpredictable regulatory environments, disproportionate penalties, and protracted legal proceedings are increasingly affecting Italy’s attractiveness as an investment destination.”
A judge will now set a date for a hearing to decide if the defendants will be indicted or if the case will be dropped. Milan prosecutors and tax police investigated the four managers and Amazon EU Sarl, based in Luxembourg, for alleged VAT evasion on online sales in Italy between 2019 and 2021.
The charges claim that Amazon’s systems allowed tens of thousands of non-EU sellers, mostly Chinese, to sell goods in Italy without revealing their identity, helping them avoid paying VAT. Italian law states that an intermediary platform is responsible for unpaid VAT by non-EU sellers.
In their request for a trial, Milan prosecutors named the Italian Economy Ministry as the wronged party. If these allegations are proven, it could impact Amazon’s business model across Europe, as VAT is a unified EU tax.
This is just one of several ongoing cases involving Amazon in Italy. The European Public Prosecutor’s Office is investigating similar alleged offenses from 2021 to 2024. Milan prosecutors also have two other investigations: one into alleged customs and tax fraud with Chinese imports, and another into whether Amazon had an undeclared base in Italy from 2019 to 2024, meaning it should have paid more taxes there.
Separately, Italy’s privacy watchdog recently told an Amazon unit to stop using the personal data of over 1,800 employees at a warehouse near Rome.
