IRS reportedly seeking $2.1b from Amazon

In the US, the Internal Revenue Service (IRS) is seeking to recover more than US$1.5b (A$2.1b) in back taxes, reports the Guardian. The report reveals details of Amazon’s ‘elaborate avoidance scheme’ called Project Goldcrest, a 28-step scheme implemented between 2005-6, which ‘fundamentally reordered its global business in Europe using a maze of offshore entities and intercompany agreements’. The Guardian reports that the IRS is questioning the legality of Amazon’s intercompany contracts, which used ‘unrealistically low values’ to transfer assets from the US to Luxembourg. A spokesperson for Amazon told the Guardian it pays all taxes it’s required to pay in every country in which it operates. ‘Corporate tax is based on profits, not revenues, and our profits have remained low given our heavy investments and the fact that retail is a highly competitive, low margin business,’ Amazon said.

Category: International news