What is the Amazon VAT evasion investigation in Italy about?

Italian prosecutors are investigating Amazon for allegedly evading €1.2 billion in value-added tax (VAT) from third-party sellers between 2019 and 2021. This investigation stems from a significant legal change that occurred in 2019, which made e-commerce platforms directly responsible for collecting and remitting VAT on sales made by non-EU sellers on their platforms. The case represents a major tax compliance issue for online marketplaces operating in the European Union, as it indicates authorities are holding platforms accountable for ensuring proper tax collection even from international third-party merchants using their services.