Saturday 1 October 2016

France seeks €1.6bn in back taxes from Google

Michel Rose

Published 25/02/2016 | 02:30

Google has been criticised for its use of aggressive tax optimisation techniques: Yui Mok/PA Wire
Google has been criticised for its use of aggressive tax optimisation techniques: Yui Mok/PA Wire

France is seeking €1.6bn in back taxes from US internet giant Google, which has been criticised for its use of aggressive tax optimisation techniques, a source at the finance ministry said yesterday.

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"As far as our country is concerned, back taxes concerning this company amount to €1.6bn," the official said.

A spokeswoman for Google France declined to comment on the amount when contacted, saying only that the company obeyed tax rules in all countries where it operated. The finance ministry also declined to comment.

The French tax authority usually issues at least one preliminary assessment before its final assessment, which can be challenged in court if not accepted, tax advisers say.

Google has its headquarters for Europe, the Middle East and Asia in Dublin were it employs 2,763 people.

Google Ireland paid €28.6m in corporation tax on revenues of €18.3bn in 2014. It made a profit here of €167.9m that year.

Google said that "administrative expenses", including royalties paid to its own offshore entities, rose to €12.5bn last year, an increase of €800m.

The company legally avoids a variety of international taxes by booking revenue through its Irish operation in this way.

It is one of a number of high-profile multinational firms facing scrutiny from EU regulators on its business affairs.

France, Britain and other countries have long complained at the way Google and other digital giants generate huge profits in their countries but have their tax bases in countries such as Ireland, where corporate tax rates are far lower.

Irish Independent

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