13 Sep 2019

French issue Google with billion dollar tax bill

2:07 pm on 13 September 2019

Google is to pay French authorities almost €1billion ($1.7b) to end a long-running investigation into its taxes.

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Photo: 123RF

The settlement includes a €500m ($NZ862.8m) fine and additional taxes of €465m ($802.4m), but it is less than the tax bill authorities had accused Google of evading.

It rounds off a four year investigation that saw authorities raid Google's Paris headquarters in 2016.

Investigators said Google owed about €1.6b ($2.67b) in unpaid taxes amid a wider crackdown on tax planning of big firms.

French authorities had been seeking to establish whether Google, which has its European headquarters in Dublin, failed to declare some of its activities in the country.

The search giant, which is part of Alphabet, pays little tax in most European countries because it reports almost all of its sales in Ireland.

It is able to do that thanks to a loophole in international tax law. However, that loophole hinges on staff in Dublin concluding all sales contracts.

The agreement allows Google "to settle once for all these past disputes," said Antonin Levy, one of the firm's lawyers.

In March, the EU hit Google with a €1.5b ($2.59b) fine for blocking rival online search advertisers and last year the European Commission levelled a record €4.3b ($7.4b) fine against the firm over its Android mobile operating system.

In January, France fined Google €50m ($86.28m) a breach of the EU's data protection rules.


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