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Amazon shares have seen a steady decline. AMZN stock has dropped more than 1% year-to-date and declined 1.17% in the last three months.
E-commerce company Amazon.com Inc (NASDAQ: AMZN) has eventually won the legal battle against the European Commission (EU) regarding the payback of $303 million in taxes. Now, Amazon will not be paying back the taxes to Luxembourg as the EU had previously ordered.
The EU court rejection on the order for Amazon to pay back $303 million in taxes came on the 12th of May. According to the EU’s general court, the EU’s executive arm could not prove an illegal tax advantage paid to Amazon by Luxembourg.
EU Says Luxembourg Gave Amazon Illegal Tax Advantage
In 2017, the European Union said that Luxembourg gave inappropriate tax benefits to Amazon. At the time, the commission complained that Amazon was granted a lesser tax payment. According to the EU, Amazon’s tax payment was four times lesser than other companies controlled by Luxembourg’s rules. However, Amazon countered the EY accusation.
In a recent email to CNBC, an Amazon spokesperson said:
“We welcome the Court’s decision, which is in line with our long-lasting position that we followed all applicable laws and that Amazon received no special treatment.”
At the time of writing, Amazon stock is trading at a price of $3,182.63. The current trading price is a 1.28% loss to its previous close of $3,223.91. The e-commerce company has been recording losses over the past months except for an increase over the last year. Record shows Amazon has increased nearly 35% over the last twelve months.
Except for the 35% gain, Amazon stock has seen a steady decline. The company’s stock has dropped more than 1% in its year-to-date and declined 1.17% in the last three months. In addition, AMZN shares have shed 4.59% over the past month and decreased by 2.49% in the last five days.
EU vs Apple
The recent ruling is not the first of its kind. Before now, there was a court order that stated that the US could not prove a tax advantage. In July 2020, the EU’s general court said that the commission was unable to prove a tax advantage. The EU team, led by Margrethe Vestager, had said that the Irish government gave a tax advantage to technology giant Apple Inc (NASDAQ: AAPL). In 12, the EU ordered Apple to refund about $15.7 billion in unpaid taxes.
After the EU’s general court ruling, the commission decided to appeal the case. The EU said that it would take the case to the highest court in Europe, the European Court of Justice.
“The Commission has decided to appeal before the European Court of Justice the General Court’s judgment of July 2020 on the Apple State aid case in Ireland.”
Vestager added that the commission would continue to utilize the tools at its disposal Wto ensure companies pay their fair share of tax.
In response to the EU’s move to appeal the case, an Apple spokesperson revealed that the company is ready to review the appeal. The spokesperson further said that the result of the appeal would not change the initial ruling of the General Court. According to the spokesperson, the ruling shows that Apple complies with the law in Ireland.