Investigations by the Milan prosecutor’s office have uncovered an alleged subcontracting scheme.
ADVERTISEMENTItalian financial police have seized €121 million from a Milan-based Amazon unit after the e-commerce giant was accused of alleged tax fraud and worker exploitation.
They are investigating the alleged use of so-called labour reservoirs – a system where large companies illegally subcontract logistics services to other firms and cooperatives to cut labour costs and pay less in taxes, according to the state-run ANSA news agency.
The order that came with the seizure stated that the tax fraud would stem from the use of an “illicit mechanism of invoices” for non-existent transactions as stipulated under various fake contracts for the supply of labour, which led to the issue and subsequent use of false documents.
Milan prosecutors reconstructed the “labour supply chain”, noting that the labour relations “were screened by ‘filter’ companies that in turn made use of several cooperative companies, which systematically omitted the payment of VAT, as well as social security and welfare charges,” the seizure order added.
Amazon Italy did not immediately respond to Euronews’ request for comment.
Amazon is the latest in a series of similar investigations by Italian prosecutors into major companies including DHL, Uber and Lidl.
Vacation rental giant Aibnb agreed to pay €576 million to settle a four-year Italian tax dispute back in December.
As for Amazon, the e-commerce company was caught in Italy’s crosshairs for alleged unfair commercial practices earlier this year.
The country’s antitrust authority fined two Amazon subsidiaries €10 million over their ‘Subscribe and Save’ option, which allowed customers to set up recurring deliveries of frequently purchased items.
According to Italian officials, the automaticity of this function infringed on consumers’ rights.
