Tax on fees paid to US by Amazon

The Indian tax authority has decided to charge a tax on cloud services fees paid by Amazon to the US, a move which will lead to the company coughing up a “significant” amount in taxes, including payments for some of the previous years, the company said in a regulatory filing.

Without sharing details of the decision, Amazon said it will contest the decision but it will have to remit a significant amount in taxes unless the matter is resolved.

“In February 2023, we received a decision by the Indian Tax Authority (ITA) that tax applies to cloud services fees paid to the US. We will need to remit taxes on the services in question, including for a portion of prior years, until this matter is resolved,” the company said.