Google dodges €1.1 billion French tax bill

Google dodges €1.1 billion French tax bill
Google has won a key court battle and it’s been spared a 1.12 billion Euro tax bill after court rejected claims the search-engine giant dodged French taxes.

French tax authorities had accused Google of illegally routing sales in France through Ireland and not paying the higher corporate taxes.

The judges however ruled that Google’s European headquarters in Ireland could not be subject to corporate and value added taxes in France.

“Google Ireland isn’t taxable in France over the period 2005-2010,” the court said in its terse statement.

The ruling can still be appealed but the ruling is a blow to French tax authorities which had counted on a real windfall.

After Google reached a £130 million settlement in the UK last month, the then French finance minister Michael Sapin declared there would be a “way bigger” payment in France. The French tax administration, he said, “does not negotiate the amount of taxes owed. It applies the rules.”

The French court decision would be a relief for Google which was fined a record $US2.7 billion by European anti-trust officials for unfairly favouring some of its own services over those of rivals.

“The French Administrative Court of Paris has confirmed Google abides by French tax law and international standards,” Google said in a statement. “We remain committed to France and the growth of its digital economy.”

 



An award winning author and journalist, commentator, lecturer, and speaker, Leon is a freelance business journalist who covers a range of areas including politics, strategy, globalization, leadership and all the big trends ahead. His main skill is summing up all the news that’s around. For the last 30 years, his main focus has been on management issues. He also produces two podcasts for RMIT University, Talking Business and Talking Technology. Leon has worked for Fairfax, News Limited, AAP and the Herald and Weekly Times.