American Tax Officer-Chapter 626 - 315: Jeff’s Misstep_2
Chapter 626: Chapter 315: Jeff’s Misstep_2
Under the gaze of everyone present, David slowly began, “The reason why Amazon Group has developed so quickly to become the number one giant in global e-commerce, I believe, is not only due to their high-quality goods and lower prices compared to other platforms but also another very important reason, which is the platform’s ‘free shipping’ service. I believe everyone agrees with this, right?”
This statement left many who were holding their breath in tension a bit dumbfounded.
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Aren’t you supposed to be talking about more serious crimes committed by Amazon? Why are you bringing up Amazon’s development now?
Before the crowd could become overly perplexed, David continued, “Of course, there’s no such thing as a free lunch in this world. There are conditions to obtaining this service, one being that each person must pay an annual membership fee of $139 to enjoy it.”
“But let’s get back to the point—it’s quite a deal, even with the $139 membership fee. It’s like having all your shopping on the platform for an entire year without any shipping costs.”
“Alright, I won’t beat around the bush any longer. Let me get to the heart of the matter. According to the accurate data we have obtained, last year Amazon’s logistics costs reached $85 billion US Dollars, and compared to the number of customers, Amazon lost at least $40 billion on the free shipping service. How does Amazon maintain the lowest costs while offering free shipping and still make money? Have you ever thought about where that money comes from?”
At the end of his speech, Lakruwa and others at the defense table were as if struck by lightning, their eyes bulging like brass bells.
The same expression appeared on the faces of many of Amazon’s top executives in the spectator seats.
Due to certain reasons, their group’s logistics costs had not been disclosed according to the real numbers, and now Director David actually knew the exact amount.
And that wasn’t the worst of it. Once an investigation began, just as David said, how could their group maintain the lowest costs with free shipping and still be profitable?
This was a secret that could not be disclosed!
“Mr. Jeff, we can’t continue on this topic, otherwise our entire Amazon Group is done for!”
On the spectator side, an Amazon Group executive was getting nervous, whispering a reminder to Mr. Jeff sitting next to him.
Actually, there was no need for him to remind Jeff, who was already on edge with every hair standing on end.
He didn’t know how much Director David knew about the internal details of this matter, but what was clear was that the details of this issue absolutely could not be exposed; otherwise, the entire group might find itself facing universal condemnation.
While the Amazon Group’s top brass were wracking their brains for a way to handle the situation, the audience was also abuzz with discussion.
Some said that Amazon must have lost so much money on logistics because they made up for it with profits from goods and merchants.
Others believed that Amazon had earned additional revenue through advertising, allowing for funds to subsidize the logistics cost.
All in all, the opinions were diverse, and not many grasped the crux of the matter.
“Director David, the logistics of our group have nothing to do with this case. I think there’s no need to discuss this any further. Let’s get back on topic. Since you’re suing us for VAT reduction and improper receipt of tax subsidies, we have nothing else to say. Let the judgment be as it may!”
Realizing the danger, Lakruwa decided that he could not let the situation escalate any further; even directly accepting the two charges was a sacrifice he was willing to make.
After all, VAT reduction and improper receipt of tax subsidies, though serious, would most likely result in a fine. At the very worst, it would mean prison time, but it wouldn’t cripple the entire group.
But if they continued to investigate the matter of the logistics amounts, and if the secret that the group had been hiding was ever revealed, wouldn’t their hundreds of millions of users rise up in revolt?
“Don’t be in such a hurry, Mr. Lakruwa.”
David glanced at him and continued, “Now let me unveil the mystery for everyone. Amazon appears to have shouldered most of the losses in logistics, but as the saying goes, there’s no such thing as a free lunch, and the wool always comes from the sheep’s back. In reality, Amazon implemented a cunning plan to incorporate shipping costs into product prices as a ‘hidden fee,’ which I call a hidden tax. This means that consumers, in addition to the annual 139 US dollars membership fee, are still paying for ‘free shipping’; it’s just that you consumers are unaware…”
“Alright, Director David!”
A sudden shout interrupted David’s speech, causing everyone to turn their heads in unison. It was none other than Jeff from the spectator seats below.
“What, why has Jeff suddenly lost his composure?”
“Whether it was the confirmation of the value-added tax reduction charge or the illegal tax subsidy offense, Jeff seemed to not have been as flustered as he is now, actually standing up to interrupt the proceedings. This definitely indicates the severity of the issue!”
“Wait… Director David just said that Amazon cleverly planned to double the shipping costs as hidden fees, is that true?”
“I know why Jeff is so anxious; if this is proven to be true, the implications could be tax evasion and even consumer fraud!”
Seeing Jeff lose his composure like this at the trial, both the audience in the court and those following online engaged in heated discussions again.
“Bang! Bang! Bang!”
The court suddenly erupted into chaos, forcing Nicola to bang her gavel thrice to silence everyone.
“Mr. Jeff, I think you need to understand something—speaking in court requires the permission of the judge. Otherwise, you will be expelled from the proceedings, understood?”
“Understood, Your Honor. As the representative of our group has mentioned, regarding the value-added tax reduction and the illicit tax subsidies—since the Los Angeles IRS has presented ample evidence, we are willing to temporarily accept these charges and the respective sanctions. However, the logistics matter is unrelated, and I request the termination of this topic!”
Jeff certainly knew how to weigh his options; at this moment, he would agree to anything as long as they did not further investigate the logistics issue, even if it meant paying a hefty price.
“Your Honor, the logistics matter involves serious tax evasion and is directly related to this case. It is also one of the points in the lawsuit filed by the Los Angeles IRS,” David also stood up to argue.
“Mr. Jeff, you’ve heard it yourself, it is an event directly connected to this case, and since the Los Angeles IRS wishes to continue with their indictment, we should proceed. Motion denied!”
“Your Honor, if we must continue, I request that we proceed with a private broadcast, or perhaps we can reach an out-of-court settlement with the Los Angeles IRS. There’s room for negotiation!”
Jeff had to settle for his next best option, and his last statement, “There’s room for negotiation,” was practically an outright plea to David that Amazon was at his mercy!
However, the viewers who were watching were not pleased; they wanted to know if Amazon was indeed charging them hidden fees. If the proceedings went into a private broadcast or settled out of court, how would they learn the truth?
So at that moment, the audience across various social media platforms began to speak out, urging the Los Angeles IRS not to agree to Jeff’s demands.
Fortunately, the following statement from David somewhat eased their concerns.
At the trial, David shook his head and said, “Mr. Jeff, you should have come to me to discuss this earlier, but now we are in court and the entire nation is watching. The IRS must maintain a stance of justice and transparency, so I am sorry!”
“David…”
Jeff wanted to say more, but at that moment, two court officers were already heading straight for him. To avoid being expelled from the court, he ultimately swallowed his words, clenched his fists, and sat back down, gritting his teeth in frustration.
