In 2022, taxation levels averaged around 20 per cent overall, with a slightly higher value for e-commerce (21 per cent) compared to traditional retail (19 per cent). Moreover, between 2016 and 2022, the tax contribution from retail increased, particularly for online trade. The study highlights that retail is characterised by low operating profit margins, resulting in a relatively low tax contribution in relation to revenues (median value around 3 per cent). It also underscores the role of digital intermediaries in commerce, due to the significant amount of indirect taxes they collect.

The research examined how the Italian tax system applies to businesses, aiming to determine if the tax burden is evenly distributed across sectors. It conducted an economic and financial analysis to evaluate the impact of tax contributions and analysed key indicators from the financial statements of the top 3,000 companies operating in Italy, split by industry, the company said in a press release.

The findings show that the 50 companies with the highest tax contributions in Italy collectively paid €3.13 billion ($3.39 billion) in direct taxes and social security contributions to the Italian government in 2022. On average, each of these top 50 corporate taxpayers contributed around €62 million ($67 million) in taxes. Amazon's total direct tax payment of over €321 million ($347 million) in 2022 places it among Italy's top 50 companies in terms of total tax contribution to the government. Amazon’s contribution aligns with the research findings that its overall tax burden relative to revenues is on par with other businesses operating in the retail sector.

As shared in Amazon’s economic impact blog, during 2022 (the base year of the research) the total tax contribution – combining directly incurred and indirect taxes – amounted to over €1.147 billion ($1.241 billion) (+53 per cent vs. €751 million ($812 million) in 2021), compared to a total revenue from Amazon’s business activities in Italy amounting to over €9.44 billion ($10.21 billion) (+8% vs. €8.75 billion ($9.46 billion) in 2021).

“Our total directly incurred taxes, which amounted to more than €321 million ($347 million). Employer taxes accounted for a large proportion of these. Other direct taxes included corporate income tax, taxes paid for land acquisition or construction, digital service tax, and import duties. We collected an additional €826 million ($893 million) in indirect taxes as a result of our business activities in Italy. These are taxes we collect and submit from our customers, employees, and other third parties, including VAT and the taxes paid by our employees. The increase in 2022 was largely driven by net VAT,” the release added.

From July 1, 2021, Amazon has been collecting and submitting Italian VAT on transactions involving overseas sellers. This VAT is calculated by Amazon and collected from customers at checkout.

Fibre2Fashion News Desk (RR)