Amazon Italy Settles Tax Fraud Probe Pays 180 Million Euros Dismantles Monitoring System

An Italian division of the e-commerce giant Amazon has finalized a significant resolution, paying compensation and dismantling a controversial monitoring system used for its delivery staff. This action brings an end to a comprehensive probe into alleged tax fraud and illegal labor practices that had been ongoing in Italy.

The investigation initially gained traction in July 2024, when Amazon's logistics services unit was accused of systematically circumventing Italian labor and tax laws. Prosecutors alleged that the company relied heavily on a network of cooperatives and limited liability companies to supply workers, thereby reportedly avoiding Value Added Tax (VAT) obligations and significantly reducing social security payments. As part of the initial judicial actions, Milan prosecutors seized an amount totaling 121 million euros from the unit.

In a major development, Amazon has now paid approximately 180 million euros (equivalent to about $209.83 million) to the Italian tax agency. This payment is part of a much broader, sprawling settlement valued at 1 billion euros, which encompasses 33 different companies that were the focus of similar investigations initiated by Milan authorities.

Among the other prominent entities implicated in these parallel investigations and subsequent settlements are the Italian units of major international logistics companies like DHL, FedEx, and UPS, alongside the Italian supermarket chain Esselunga. News of this extensive settlement first came to light through reports published by the Italian newspaper Il Sole 24 Ore.

A crucial outcome of this agreement is the commitment from all companies under investigation to directly employ more than 50,000 workers. These individuals were previously engaged indirectly through the aforementioned cooperative structures, marking a substantial shift in employment practices within the affected sectors.