Italy - Compliance Challenges for Amazon Italia

Italian officials are conducting a thorough investigation into the Amazon Italia LLC. The first aspect of the investigation concerns the logistics services unit of Amazon Italia Transport, which is under scrutiny for potential labor and tax law violations. The second investigation concerns a separate investigation into potential tax evasion.

Facts of the Cases

On July 23, 2024, Italian tax officials seized around EUR 121 million (USD 131 million) from Amazon Italia Transport to investigate suspected tax fraud and illegal labor practices. 

The Milan Prosecutors' Office issued a 94-page order alleging that Amazon Italia Transport has bypassed labor and tax regulations. The accusation involves using cooperatives or limited liability companies to provide workers while avoiding VAT obligations and lowering social security contributions.

Three days later, on July 26, 2024, the second investigation was announced concerning tax evasion. More specifically, the investigation centers on tax regulations concerning the trade of goods in Italy and internationally, emphasizing VAT and customs duties. The extent of the possible tax evasion has not yet been determined.

Over the past few years, starting from 2021, Italy's tax authorities and tax police in Monza, a city just north of Milan, have been inspecting Amazon's accounts in Italy as part of the ongoing investigations.

Conclusion

While stating that it complies with all applicable laws and regulations where it operates and requires companies that work with Amazon to do the same regarding the first investigation, Amazon did not comment on the second one.

At this stage of the investigation, it is important to remember that all these investigations are based on suspicion of tax evasion, and the final result remains to be seen.

Source: Reuters -Italy seizes $131 mln from Amazon over alleged tax, Reuters - Amazon under second investigation