'French to make 1 bn euro tax claim against Google'

Feb 04, 2014
The Google cultural hub in Paris is pictured on December 10, 2013

French authorities have decided to make a tax claim of 1 billion euros against Google following a probe into the tax strategies by the US Internet giant, Le Point magazine reported Tuesday.

A Google spokesman in France declined to comment on the report, saying the company does not comment on rumours.

The French finance ministry also declined to comment, citing confidentiality.

France is one of a growing number of cash-strapped nations to pursue more aggressively what they see as abuse of tax and accounting rules that allows some multinational companies to pay less tax.

French tax inspectors searched Google's Paris offices in June 2011 as it opened a probe into how the company implements transfer pricing between its different units, a strategy many multinationals use to shift and tax liability between countries.

Google has reduced the amount of tax it pays in France by funnelling most of its revenue through a Dutch-registered intermediary and then to a Bermuda-registered holding, Google Ireland Limited, before reporting it in low-tax Ireland.

According to court documents obtained by AFP, Google France reported 192.9 million euros of revenue in 2012, and paid 6.5 million euros in tax on the 8.3 million euros of net profit it earned.

Industry analysts estimate that Google generated between 1.25 and 1.4 billion euros in revenue in France in 2011, mainly from Internet advertising.

Last year the Group of 20 advanced and developing nations endorsed an action plan to clamp down on which its creators say could lead to the biggest change in the global tax system since the 1920s.

Explore further: News Corp. to buy Move Inc. for about $950 million

add to favorites email to friend print save as pdf

Related Stories

Google loses appeal against French tax searches

Nov 02, 2012

A Paris appeals court has rejected a request by Internet search giant Google to invalidate the search and seizure of documents by French tax authorities, according to a copy of the decision obtained by AFP ...

French authorities probe Google's tax bill

Mar 20, 2012

French authorities are probing Google for potential tax avoidance, a source close to the matter said Tuesday, with the US Internet giant facing a possible bill of over 100 million euros ($132 million).

Google chairman hopes for France tax deal soon

Nov 05, 2012

Google chairman Eric Schmidt said Monday he hopes his firm will reach a settlement "by the end of the year" with authorities in France in a billion-dollar dispute over taxes.

Google 'open to mediation' in France revenue row

Nov 06, 2012

Google said on Tuesday it was open to the idea of appointing a mediator to help end its bitter row with French news media sites that want to make the US Internet giant pay to display links to their content.

Italian probe alleges Google underpaid tax

Nov 28, 2012

A probe by Italian tax authorities into US Internet giant Google's Italian arm has found it failed to declare income of 240 million euros ($310 million) and pay value added tax of 96 million euros.

Recommended for you

What's PayPal's first solo move?

15 hours ago

PayPal's impending split from long-time partner eBay Inc. will ratchet up its appeal to online retail competitors such as Amazon.com and give it the freedom to aggressively take on new mobile pay challeng ...

AOL to feed more video, news to Microsoft's MSN

20 hours ago

AOL will provide Microsoft's MSN with more video and additional news stories from popular sites such as The Huffington Post and TechCrunch in an expansion of a deal aimed at selling more digital advertising.

Microsoft to tap $2-trillion Indian cloud market

Sep 30, 2014

Microsoft announced plans Tuesday to offer its commercial cloud services from Indian data centres as it seeks to tap what it calls a $2-trillion market in the country where Internet use is growing rapidly.

User comments : 0