2020 economic impact data confirms Amazon is a powerful engine of growth for the Italian economy. Through innovation, investments and job creation, Amazon is helping transform the economic potential of urban and rural communities. In the decade Amazon has been operating in Italy – amazon.it launched in November 2010 - we have achieved important milestones that go well beyond offering customers great convenience, fast shipping and wide selection. We have become an integral part of the country´s business fabric and the communities where we work and live.
“We’ve invested heavily in the Italian economy and in its people, more that €8.7 billion so far, and we are employing more than 12,500 talented individuals who receive competitive pay and comprehensive benefits from day one. I’m particularly proud of how our growing team and our investment on behalf of customers and Italian small businesses contribute to Italy’s recovery, creating thousands of additional jobs through indirect effects and opening up new opportunities for colleagues, selling partners, service providers, and suppliers.” Mariangela Marseglia, VP Country Manager Amazon.it and Amazon.es
Investing in infrastructure
Since 2010, Amazon has made direct investments in our Italian operations of more than €8.7 billion. This includes both capital expenditure (such as the infrastructure we build, our fulfillment centers, sortation centers, delivery stations, corporate offices, and data centers), and operating expenditures (such as the salaries we pay to our employees in Italy). In 2020 alone, we invested over €2.9 billion in the country as we try to get closer to our customers and improve our services at a time, due to the COVID-19 pandemic, many have come to rely on e-commerce and Amazon bringing the goods they need in a safe manner.
Amazon´s current network in Italy encompasses more than 50 different sites. In 2020 alone, the company opened two new fulfillment centers in Castelguglielmo/San Bellino (Rovigo) and Colleferro (Rome), as well as nine delivery stations across the country, including in the south of Italy, Sicily and Sardinia. Our logistics footprint expanded in 2021 when we opened two new fulfilment centers in Novara and Cividate al Piano (Bergamo), a sortation center in Spilamberto (Modena), and many delivery stations across the country. This is bringing us closer to our customers and creates jobs, often in areas that have historically suffered from high unemployment rates.
Amazon is also expanding its corporate offices in Milan, its customer services in Cagliari, and its development center in Turin, where our linguists and machine learning experts help Alexa to improve Italian language understanding.
To support the digital transformation and recovery of the Italian economy, in 2020 Amazon Web Services opened the AWS Europe (Milan) Region, enabling Italian small and medium-sized enterprises (SMEs), start-ups, large enterprises or government agencies, to run their businesses, store data in Italy, and serve end users with even lower latency. Millions of customers trust AWS to power their infrastructure, become more sustainable and agile, lower costs, and support them in their digital transformation.
Our investments are aimed at building the necessary digital and physical infrastructure to deliver products and services to millions of Italian customers. Many of those products do not actually come from Amazon, they come from the more than 18,000 Italian SMEs selling on Amazon. Their success is our success and we will continue investing in the logistics, tools, services and programs to help the recovery of our economy through their digital transformation.
Amazon has become a major engine for quality job creation in Italy
Amazon’s local Italian-based workforce has grown rapidly to reach more than 9,500 people at the end of 2020, we have created 3,000 new permanent roles in 2021, and we are on track to hire 500 additional roles by the end of the year. The total workforce in Italy is now more than 12,500. That´s more than 20 permanent jobs a week created in Italy by Amazon over the last 11 years. According to a recent study* by The European House – Ambrosetti, Amazon is the private company that has created more jobs than any other company in Italy over the last 10 years.
In 2020, Amazon paid an average of €24.5 million a month in wages and salaries to our Italian employees. This was a substantial increase compared to €17.2 million/month in 2019, due to the rise in the number of our employees and the impact of the “Thank you” bonuses granted in 2020.
Our state-of-the art facilities offer local employees a great and safe working environment, opportunities for professional development, competitive salaries, and rewarding benefits. Our people are what make this company great, and we reward them well. Since October 2021, for example, our associates in Italy have been benefitting from a salary increase, with the company adding €130 gross per month to their starting wage. Monthly gross salary in our fulfillment operations starts at €1,680, 8% more than the transport and logistic CBA, plus extras: for example, discounts for purchases on Amazon.it, private healthcare insurance and private medical assistance, which is a big step up from most entry-level jobs. On top of the standard benefits, we offer a special education program which pre-pays 95% of tuition and associated fees for permanent employees to undertake nationally recognized courses, funding up to €8,000 over four years.
We offer opportunities to people with a wide range of qualifications, whether they are starting their career or experienced specialists and executives in fields such as software development, linguists, logistics, human resources and IT across our Italian corporate office in Milan; development centers in Turin and Asti; our customer service center in Cagliari; and our fulfillment centers, delivery stations and logistic sites for Fresh deliveries across Italy.
Across the company, we write diversity in capital letters and provide equal opportunities to everyone. In 2021, we were certified as a Top Employer by the Top Employer Institute in recognition of our diverse working environment, our professional development opportunities, and training programs.
According to a recent Keystone Strategy study, through indirect effects of our investments, more than 85,000 new jobs have been created in 2020; for example, in construction, logistics, and by Italian small and medium businesses using Amazon’s Made in Italy showcase or services to grow their businesses and export Italian products around the world.
Italian SMEs succeeding on Amazon
In addition to investing in our communities and creating jobs, we also invest in tools and support for a large number of small businesses across the country who use our technology and services to grow their businesses through increased sales within, and beyond, Italy.
In 2020, there were more than 18,000 SMEs selling on our stores (from 14,000 in 2019). In 2020, Italian small and medium-sized enterprises exported products worth more than €600 million via Amazon, and over 200 IT SMEs selling on Amazon surpassed €1 million in sales for the first time. They have also created over 50,000 jobs in Italy to date to support their businesses online.
Empowering smaller companies is at the core of everything Amazon does: in 2020, we launched Accelera con Amazon, to boost the growth and the digitization of more than 10,000 small businesses across Italy and, in 2015, the Made in Italy showcase to sustain Italian artisanal excellence at home and abroad.
Progressing in our path to net zero carbon by 2040
Amazon is committed to using our size and scale to make a difference for the planet. Amazon is the first signatory of The Climate Pledge, which was launched together with the NGO Global Optimism in 2019. That means we are committed to becoming net zero carbon across our entire global business by 2040—a decade ahead of the Paris Agreement’s goal. We are working towards these goals by taking immediate action to decarbonize across our business operations: be it energy usage, transportation or packaging. One of our programs, “Shipment Zero”, aims to make all Amazon shipments carbon neutral, with the goal of reaching 50% of our shipments to be net zero carbon by 2030. Amazon is also investing in wind and solar to reach 100% renewable energy across our global operations by 2025. According to our 2020 sustainability report, we achieved 65% renewable energy across our operations, up from 42% in 2019. And our progress to decarbonize our operations reflects in our carbon intensity, which decreased 16%. Nearly half of our carbon intensity improvement is a result of our investments in renewable energy and operational efficiency enhancements.
In Italy, we announced the first two solar off-site projects in Sicily: the two agro-photovoltaic plants are two innovative projects that combine clean energy and agricultural crops, and will have an overall production capacity of 104MW Peak (83MW of AC capacity, of which 66MW will be for Amazon). 80% of the energy produced will indeed be destined for Amazon and will allow us to power our sites in Italy, as well as AWS data centers, while the remaining 20% will be connected to the grid, providing enough to power 20,000 homes. In addition to that, eight sites in Italy are also provided with onsite solar systems on their rooftops, and each onsite solar installation can generate as much as 80% of a single fulfillment facility’s annual energy need.
Moreover, as part of our Right Now Climate Fund, we are investing in nature-based projects to improve environmental conditions in the communities where we operate across Europe. In Italy, we are supporting Parco Italia, an urban forestry program that aims to plant 22 million trees – one tree per city resident – across 14 metropolitan areas in Italy as part of a reforestation and research program supported by the Italian Society of Silviculture and Forest Ecology, the Fondazione AlberItalia and Stefano Boeri Architetti. The Parco Italia program will receive €2 million to support the strategic planning of the program and initial tree planting. The project will also help cities to become more climate change-resilient, increasing urban biodiversity, improving air quality, and promoting urban cooling. Furthermore, in Italy, as part of the Climate Pledge Fund - a $2 billion investment program to sustain visionary startups and companies developing decarbonizing technologies and services – we are investing in CMC Machinery, a company based in Umbria with technology which makes custom-sized boxes that eliminate the need for single-use plastic packaging. In 2020, we launched Climate Pledge Friendly, an easy way to find more sustainable products on our store. Currently, there are over 100,000 products labelled as Climate Pledge Friendly on European stores, because they have one or more of the over 30 sustainability certifications that help preserve the environment.
Total tax contributions in Italy
As we continue to hire, invest, and grow in Italy, we contribute our share to fund public services and infrastructure throughout the country. We do this through the taxes that are collected by the government as a consequence of our activities in Italy. Those taxes fall into two categories:
· Directly incurred taxes: the taxes that are directly incurred and payable by Amazon, including Corporation Tax (Ires and IRAP), taxes paid for land acquisition or construction (Property Tax, Registration Tax), payroll taxes and social security paid by employers, import duties and DST.
· Indirect taxes collected and remitted: the taxes we collect and remit from our customers, employees, and other third parties because of our business activities in Italy. These include VAT and the taxes paid by our employees.
It’s important to understand both of those categories, because focusing narrowly on one aspect of taxation, such as Corporation Tax, doesn’t tell the whole story: Corporation Tax, according to some recent research conducted by the OECD, accounts for only around 5% of total tax revenues from Italian taxpayers.
Amazon is a growing business which has a high volume of sales, but operating profits remain relatively low due to price pressure in a competitive market, significant capital investment programs, and increasing operating costs (including those from a growing workforce). Most governments—including the Italian Government—actively encourage companies to make these investments, and they often use the taxation system to do so. On the one hand, these reduce Corporation Tax short term, but this is more than made up for by the increased tax revenue long term, or lower costs for the Government in other areas.
This is what our tax numbers look like in detail:
- In 2020, the total revenues of Amazon’s activities in IT were €7.25bn
- In 2020 Amazon invested more than €2.9 bn in Italy, including almost €367 million as capital expenditure (i.e. infrastructure: fulfillment centers, corporate offices and data centers)
- Our total tax contribution was €345 million. This splits into:
- Our total directly incurred taxes were €186 million. Employer taxes accounted for a large proportion of these.
- The indirect taxes we collected of an additional €159 million in taxes as a result of our business in Italy.
Italy is a center of talent and opportunity, and we’re pleased to play a role in fostering that and supporting growth. We continue to be excited by the potential to continue to invest, invent, and create jobs and economic opportunities in communities across the country.