Did Amazon make “121 billion profits in the second half of 2022 in Europe”, as MP Thomas Portes writes?

The elected Nupes-LFI wanted to denounce the discrepancy between the sums collected by the e-commerce giant and the amount of taxes he pays in Europe. But got tangled up in the process.

Amazon makes billions in profits, while paying no tax on these sums to European states. This is the idea defended by Thomas Porte, deputy Nupes-La France insoumise of Seine-Saint-Denis. Following a survey published in Humanity Monday, November 7, the deputy tweeted in which he claimed that the American e-commerce giant “made 121 billion in profits in the second half of 2022 in Europe”.

The figure was later picked up in a Communist Party publication, lamenting: “Amazon is 121 billion in profits in 2021 in Europe.” But also by the colleague of Thomas Portes in the National Assembly, elected from Haute-Vienne, Damien Maudet.

Problem: these 121 billion actually correspond to the turnover achieved by Amazon, and not to the profits of the company. Then, the figure does not concern the second half of 2022 (which is not yet finished), but the second quarter of the year. Finally, it covers all of Amazon’s operations globally, not just in Europe.

Accounting documents

This is indeed what indicates Humanity in his article, both in the printed version of the daily and in its resumption on the newspaper’s website. “While the multinational achieves record revenues – 121 billion dollars in the second quarter of 2022 – Amazon paid no tax on its profits in Europe in 2021”, is it written there. The Human thus uses here the term “income” as a synonym of “turnover” (even if from a strictly accounting point of view the two indicators may differ).

The $121 billion figure is taken directly from Amazon’s accounting records, whose results for the second quarter of 2022 were released on July 28. Despite this substantial turnover, the e-commerce leader claims not to have made a profit at the same time, but a “net loss” amounting to 2 billion dollars.

It should be noted that more recent results have since been released, those relating to the third quarter of 2022. Made public on October 27, they report a turnover reaching 127.1 billion dollars over this period, and a “ net profit” of 2.9 billion.

“Sorry, it happens”

Asked about his triple confusion, both spatio-temporal and in terms of the indicator used, Thomas Portes responds to CheckNews that he has “made a mistake while tweeting”, adding: “I was wrong, sorry, it happens.” As for Damien Maudet, he answered himself on Twitter by correcting the use of the word “benefits” by “turnover”.

This confusion does not detract from the substance of the speech made by the rebellious deputy, he believes, insisting on the discrepancy between the sums collected by Amazon and the amount of taxes which the group must pay: “0€!” Indeed, Amazon Europe did not have to pay taxes in 2021, due to losses amounting to 1.16 billion euros – while the European subsidiary of Amazon recorded that year a figure revenue of 51.3 billion euros (+17% over one year). Losses that the firm attributes to investments made on European soil.

Amazon Europe also benefits from special tax provisions thanks to its establishment in Luxembourg, a country in which the American giant chose to establish itself in 2003. These tax schemes have made Amazon a privileged target for European regulators. While in 2017, the European Commission had claimed 250 million euros from it in arrears, considering that the Luxembourg tax rebates constituted irregular state aid, this decision was canceled in 2021 by the Court of Justice of European Union.

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