Technology giant Google is to pay £130 million (172 million euros, $185.4 million) in back taxes to Britain after an "open audit" of its accounts, the BBC reported Friday.
"Today we announced that we are going to be paying more tax in the UK," head of Google Europe Matt Brittin told the BBC.
"The rules are changing internationally and the UK government is taking the lead in applying those rules so we'll be changing what we are doing here," he added.
"We are paying £130 million in respect of previous years when the rules were to pay in respect of profits you make in a country and then going forward we will also be paying in respect of sales to UK customers."
The company will pay more tax on sales in Britain in future, the BBC reported, and register a greater proportion of sales activity in Britain instead of Ireland, where its European headquarters is based and which has a lower rate of corporation tax.
The agreement follows a six-year inquiry by British tax authorities, in response to concerns over low taxes paid by multinational corporations which operate in Britain but have headquarters elsewhere.
Google is among several top technology firms under pressure for complex tax arrangements.
Apple agreed to pay Italy 318 million euros to settle a tax dispute last month, and world leaders vowed in November to clamp down on schemes by multinationals to minimise tax.
Google did not immediately respond to a request for comment.
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