SPAIN INVESTIGATING GOOGLE FOR POSSIBLE TAX EVASION; FRANCE + ITALY ALSO INVESTIGATING
The Spanish authorities have opened a new investigation into possible tax evasion by Google, broadening the scrutiny of the American technology giant in Europe.
The authorities visited the company’s offices in Madrid on Thursday as part of the inquiry, according to a person briefed on the matter who spoke on the condition of anonymity because he was not authorized to discuss the matter publicly. It was unclear whether the officials had questioned executives or had taken documents. The inquiry was reported earlier by the Spanish news media.
The new investigation adds to a long list of inquiries into corporate tax practices in Europe, where the authorities are broadly looking into whetherAmerican companies like Google, McDonald’s and Amazon, among others, improperly shifted profits across the region to reduce their tax payments. The companies deny any wrongdoing.
In late May, French tax authorities raided Google’s offices there, saying the company was under investigation for aggravated financial fraud and organized money laundering. Italian authorities are looking into whether the company did not pay a sufficient amount of tax.
In a statement, Google said that it complied with the tax laws of every country in which it operates.
“We are cooperating fully with the authorities in Madrid to answer their questions, as always,” said Mark Jensen, a Google spokesman.
A spokesman for the Spanish tax authorities declined to comment. The investigation in Spain is still in the early stages.
The search giant has been routinely criticized for routing much of its European revenue through its regional headquarters in Dublin, which benefits from one of the region’s lowest corporate tax rates.
This year, Google agreed to pay an additional 130 million pounds, or $175 million, to British authorities to cover back taxes from 2005 to 2015. The company also said it would change how it calculates its tax payments in Britain so that they are based on a percentage of local sales derived from the country.
Despite the extra tax revenue, Britain’s politicians criticized the amount for being too low compared with the annual revenue Google gets from its British business. Analysts have said that potential tax clawbacks, particularly in France, could amount to hundreds of millions of dollars if the company is found to have breached local rules.
And the tax investigations are just a piece of Google’s problems in Europe. The company faces a string of other regulatory problems in the region, including antitrust cases linked to some of its search and Android mobile software businesses.
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