• France's news in English
 
app_header_v3
France demands €1.6 billion in tax from Google
Photo: AFP

France demands €1.6 billion in tax from Google

AFP · 25 Feb 2016, 08:46

Published: 25 Feb 2016 08:46 GMT+01:00

Google is one of several companies that have come under fire in Europe for paying extremely low taxes by shifting revenue across borders in an often complex web of financial arrangements.
   
"In regards to France, a €1.6 billion adjustment has been imposed on the company," the source told AFP, speaking as Google's CEO was in Paris.
   
Google declined to comment and the French finance ministry told AFP the amount the company would have to pay was subject to "fiscal confidentiality".
   
The figure emerged as Google CEO Sundar Pichai was in Paris, where he was set to meet Wednesday night with France's economy minister, Emmanuel Macron.
   
Speaking at the elite Sciences Po university in Paris before the tax demand hit the press, Pichai defended in general terms Google's tax practices.
   
"We're a global company. We have to abide by tax laws everywhere, we do abide by local tax laws in every single country," he said.
   
"We're advocating strongly for a simpler global tax system," he added.
   
France has previously refused to negotiate the amount of back taxes it would request.
   
However, a source inside France's tax authority said bargaining may still be possible.
   
"This does not mean that Google will ultimately pay 1.6 billion," the source told AFP. 
 
"There will be appeals, and perhaps a negotiation in the end, in particular on penalties."
  
A deal last month between British tax authorities and Google was meanwhile criticised by a panel of British lawmakers who described the settlement reached as  "disproportionately small" given Google's size and earnings.
   
Under the agreement, Google will pay £130 million ($185 million, €170 million) for a decade of Google business in Britain, where it makes 11 percent of its global sales.
  
Billions in fines 
 
The company made profits of £106 million on revenues of £1.18 billion in Britain in the last 18 months alone and the Labour opposition party claimed the giant was paying only "three percent tax".
   
French Finance Minister Michel Sapin earlier this month said Google would not get a deal of that type on his side of the Channel.
   
"In France we would like to avoid an exceptional situation where there would be some type of flat-rate tax," he said.
   
Italy is also demanding Google pay over €200 million in back taxes following an inquiry by the financial police.
Story continues below…
   
The European Commission has cracked down hard on companies, including US icons such as Apple, Starbucks and Amazon, who have worked out arrangements with countries allowing them to slash their tax bills.
   
Swedish furniture giant Ikea has also been accused of underpaying taxes by one billion euros by using aggressive tax strategies in certain European countries.
   
Fights over tax bills are not the only trouble Google is contending with in Europe.
   
European competition officials have been investigating the US tech giant for years over alleged monopolistic practices involving its search engines, but any resolution has been elusive.
   
Three successive proposals by Google for an amicable settlement have been rejected.
   
If no agreement is reached and the group is found to have broken the EU's antitrust rules, it could face fines amounting to billions of dollars.

Your comments about this article

Today's headlines
13 injured in Welsh bus accident in France
The bus ended on its side in a ditch. Two helicopters were dispatched to the site. Photo: AFP

Thirteen people were injured, three of them seriously, when a bus carrying teenagers from Wales tipped over on a motorway in eastern France on Saturday, the local gendarmerie said.

Libya armed groups urge fight against French troops
Dozens of protesters rallied Friday outside the GNA’s former headquarters in a Tripoli navy base. Photo: AFP

Armed groups including Islamists have urged Libyans to mobilise against French and other foreign troops deployed in the country, denouncing their presence as a “blatant aggression”.

EgyptAir flight broke up midair after fire: report
The Airbus A320 was en route from Paris to Cairo when it disappeared from radar over the Mediterranean. Photo: AFP

An EgyptAir flight that crashed into the Mediterranean in May likely broke up in midair after a fire erupted in or near the cockpit, the New York Times has reported.

IMF boss Lagarde to stand trial over $400 million payout
Lagarde will be the third successive IMF chief to face trial. Photo: AFP

IMF chief Christine Lagarde was ordered Friday to stand trial in France over a massive state payout to a colourful tycoon when she was French economy minister, dealing a setback to her stellar career.

Hollande defends minister under fire over Nice attack
The Nice assault was the third major attack on French soil in the past 18 months. Photo: AFP

French President Francois Hollande on Friday defended his government from accusations it relaxed its anti-terror defences after the Euro championships, and announced plans to arm the fight against the Islamic State group which claimed the Nice attack.

Why was Nice ordered to delete CCTV images of attack?
Photo: AFP

The fact that city authorities in Nice were asked to delete images of the truck attack has only given weight to those criticizing the government.

Thirteen free and easy ways to learn French
Photo: Runs With Scissors/Flickr

Struggling to learn French? Here are some free and easy ways to help you conquer the language once and for all.

32 mistakes foreigners make when they arrive in France
Photo: Tatyana A./Flickr

How many of these have you committed?

France to supply Iraq artillery as it steps up fight against Isis
Photo: AFP

France is stepping up its battle against Isis in the Middle East.

How to show solidarity with France? Don’t cancel your trip
Photo: AFP

The best way to show fraternity with France after the latest terror attack is not on Facebook or Twitter, but by coming to visit.

Sponsored Article
5 reasons to try dating in Paris with The Inner Circle
Features
Six outdoor bars in Paris you simply must visit
Sponsored Article
Why you should attend an international job fair
Culture
The open-air Villette cinema has been cancelled over security fears
Culture
Henri Rousseau exhibition proves huge hit in Paris
National
Frenchman caught trying to sell Nice massacre souvenirs online
Society
OPEN NOW: Here's why you should head to the Paris Plages
Culture
What's on in France: Still plenty to see and do in July
Lifestyle
Treasures of Versailles to go on display in Australia
Sponsored Article
Avoid hidden fees when sending money overseas
National
How to keep cool during France's heatwave
Sponsored Article
Why Swiss hospitality graduates are in demand
National
Nice attack: What we know so far
National
Nice attacker: Body-building, drug-taking, violent flirt
National
IN IMAGES: Drawings in tribute to Nice attack victims
Sponsored Article
Why expats choose international health insurance
Society
Promenade des Anglais: The iconic heart of the French Riviera
France faces more questions after latest deadly attack
National
Why is France the target of choice for jihadist attacks?
Sponsored Article
Why you should attend an international job fair
National
Nice truck attack: 'Bodies went flying like bowling pins'
Nice attack: Families of missing make pleas on Twitter
Politics
Boris Johnson cheered and booed at Bastille Day party
Sponsored Article
Why Swiss hospitality graduates are in demand
National
Ten reasons not to leave Paris this summer
Ten ways other expats in France drive you mad
Sponsored Article
Why expats choose international health insurance
'Very Stupid' village in France honoured for its silly name
Travel
Ten crazy things to do in France if you dare
Society
Paris: an obstacle course for wheelchair users
Brits ignore Brexit fears to make dream move to France
2,763
jobs available