EU-based small businesses saw total sales of over €40 billion on Amazon in 2025, which the online retail giant said were driven by strong growth in cross-border trade.

New figures released by Amazon show that over 100,000 small and medium-sized enterprises (SMEs) sold through the platform last year, generating €17 billion in exports last year, up €2 billion year-on-year.

Intra-EU cross-border sales reached €13.5 billion, rising from €12 billion in 2024, which Amazon said highlights the increasing role of digital platforms in enabling international expansion.

The company added that its data shows how online marketplaces are lowering barriers to entry for SMEs, allowing businesses to reach customers across multiple countries without building their own logistics and distribution infrastructure.

Despite the growth, Amazon said SMEs face regulatory challenges when operating across borders. Sellers must navigate rules including VAT regimes, labelling requirements and Extended Producer Responsibility (EPR) schemes.

The company argued that these compliance costs disproportionately affect SMEs. Businesses expanding into multiple markets often need specialist support to manage VAT reporting and regulatory obligations, and Amazon estimated these costs can account for up to 25–30 per cent of overall operations.

Amazon called for EU leaders to implement regulatory reform to simplify cross-border trade, including extending deemed supplier rules to cover all sellers. The company said this would shift VAT collection responsibilities onto marketplaces, reducing administrative burdens for SMEs and helping ensure more consistent compliance.

“The European Commission agreed to try to streamline VAT regimes, but it's happening too slowly, and we're hearing from small and medium-sized enterprises that it needs to happen faster,” said Amazon’s chief global affairs and legal officer, David Zapolsky.

He added that tax rules mean European small businesses have to navigate 27 different VAT systems, while some bad actors exploit loopholes by falsely registering companies in Europe to avoid stricter oversight.

"This strange disparity between the way reseller rules affect non-EU sellers versus EU sellers means there is a fraud vector,” Zapolsky said. “Certain sellers can set up pretend domiciles in the EU to avoid this payment obligation, and in doing so, they never pay VAT at all.

“Extending deemed supplier would close off this fraud vector and enable the European Union to collect significantly more revenue."

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