Investigators in France have raided Google’s Paris headquarters amid a probe over the company’s tax payments, Reuters reported on 24 May. The French Finance Ministry is reportedly investigating €1.6bn (£1.2bn) in back taxes.
The raid is part of an investigation into “aggravated tax fraud” and money laundering, authorities said. The raid is the latest regulatory headache for the American search engine-and-email company, which like other Silicon Valley firms faces increasing questions about its complex tax arrangements.
According to a report in French daily, Le Parisien, at least 100 investigators are part of the raid at Google’s offices. Police sources have confirmed that the raid is taking place and source close to the finance ministry said the raid at Google’s offices has been ongoing since 5am local time (3am GMT).
In February, a source at the French Finance Ministry told Reuters that the government was seeking €1.6bn in back taxes from Google. The official spoke to Reuters on condition of anonymity and said at the time: “As far as our country is concerned, back taxes concerning this company amount to €1.6bn.”
However, France is not the only country that has had problems with Google’s tax payments. A number of international companies have come under scrutiny in Europe for gaining profit in their countries but have their tax base in countries where corporate taxes are lower.
In the UK, Google’s tax structure allowed the company to pay tax in the Republic of Ireland, despite sales being made in the UK. In January Google came to a deal with the UK tax authorities and was forced to pay an extra £130m in tax to make up for lower payments since 2005. At the time, the UK Public Accounts Committee referred to the settlement as “disproportionately small”.
The Google France raid comes weeks after the European Union announced plans to force companies to disclose details about their tax affairs. Under the new regulations, companies operating in the EU would have to disclose how much tax they pay in each EU country, as well as disclose activities carried out in tax havens.