Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) hit by tougher tax enforcement put in place by the EU.

Technology giants Amazon and Apple have been ordered by Brussels to pay back a series of owed money to the union, after it deemed it had received unfair tax breaks.

Specifically, Amazon has been ordered to pay around €250 million for back taxes in Luxembourg after benefiting from illegal state aid.

In addition, the commission’s competition watchdog has ordered Ireland to collect €13 billion in taxes owed by Apple, which it has since failed to collect.

“Luxembourg gave illegal tax benefits to Amazon. As a result, almost three-quarters of Amazon’s profits were not taxed,” said Ms Margarethe Vestager, the European competition commissioner.

She added: “In other words, Amazon was allowed to pay four times less tax than other local companies subject to the same national tax rules. This is illegal under EU state aid rules. Member states cannot give selective tax benefits to multinational groups that are not available to others.”

Amazon rebutted the claims, stating: “We believe that Amazon did not receive any special treatment from Luxembourg and that we paid tax in full accordance with both Luxembourg and international tax law. We will study the commission’s ruling and consider our legal options, including an appeal.”.

The deliberation on Amazon follows a three-year long investigation by the European Commission amid concerns that the company had violated EU regulations.

Back in 2003, Amazon struck a deal with Luxembourg, after it issued a “comfort letter” to the company, which introduced a cap on profits which could be taxed in Luxembourg.

Ultimately, this was concluded as giving the company an unfair advantage over competitors, motivating its decision to push back on unpaid tax.

It is currently estimated that Amazon is still yet to pay $1.5 billion to US tax authorities.

Shares in both companies are down marginally in pre-market trading.