French police raid Google’s Paris headquarters as part of €1.6 billion tax fraud investigation
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French police searched the Paris offices of U.S. internet giant Google today as part of a tax evasion and money laundering investigation, it has emerged.
Authorities believe Google owes 1.6 billion euros (£1.2billion) in back taxes in France, a source close to the matter said in February.
The investigation, which started in June last year, aims to verify whether Google Ireland Ltd has failed in its fiscal obligations in France, the prosecutor’s office said in statement.
Google is one of several multi-national corporations that have come under fire in Europe for paying extremely low taxes by shifting revenue across borders in a complex web of financial arrangements.
Its European operations are headquartered in Ireland, which has some of the lowest corporate tax rates in the region.
A source close to the finance ministry said investigators have been at the company offices since 5am today. About 100 officers are involved, Le Parisien reported.
A spokesperson for the company said: ‘We are cooperating with the authorities to answer their questions. We comply fully with French law.’
It has been raided by French authorities before, in June 2011, during an investigation into transfers to its Irish headquarters.
In January, Google agreed to pay £130million in back taxes to Britain, prompting criticism from opposition lawmakers and campaigners.
At the time the U.S. online search firm, which has faced severe criticism of its UK financial arrangements, said the payment would cover back taxes from 2005 to 2015.
It also agreed to make changes so that future payments to HM Revenue and Customs will ‘reflect the size and scope of our UK business’.
‘We have agreed with HMRC a new approach for our UK taxes and will pay £130million, covering taxes since 2005,’ said a spokeswoman for Google.
‘We will now pay tax based on revenue from UK-based advertisers, which reflects the size and scope of our UK business.
‘The way multinational companies are taxed has been debated for many years and the international tax system is changing as a result. This settlement reflects that shift and is in line with recent OECD guidance.’
In early February Finance Minister Michel Sapin ruled out striking a deal with the company as Britain did, saying the sums at stake in France were ‘far greater’ than those in Britain.
