Up to 100 investigators entered Google's French headquarters in Paris Tuesday to ascertain whether the search giant has failed to pay up to 1.6 billion euros ($1.8 billion) in taxes.
The raid is part of a preliminary probe that was opened in June 2015 to investigate “aggravated fiscal fraud” on the part of the search giant. In a statement Google said it is cooperating with authorities to answer their questions: "We comply fully with French law."
A report from local publication Le Parisien, citing an anonymous source, claims French prosecutors entered the headquarters in Paris' 4th district as early as 5 a.m. local time, with the action labeled a "top secret" investigation.
The source added: “It has even been led without using the tax authority’s messaging service, to avoid leaks.” The 100 investigators were joined by five magistrates from the French justice authority and police officers. The raid follows France’s ministry of finance demanding Google pay 1.6 billion euro in taxes, claiming the company shifted money to its subsidiary in Ireland to avoid paying back taxes.
Reuters, citing a French prosecutor, says the Paris raid “aims to verify whether Google Ireland has failed in fiscal obligations in France.”
The company has come under a lot of scrutiny for its tax affairs in Europe, including in Italy, where it is facing calls to pay back almost $225 million in taxes. Despite coming to an arrangement with the U.K. government to pay back $185 million taxes covering a period dating back over a decade, officials in that country continue to criticize Google.
“This is a major success of our tax policy,” U.K. Chancellor George Osborne said at the time. “We’ve got Google to pay taxes, and I think that is a huge step forward and addresses that perfectly legitimate public anger that large corporations have not been paying tax. I think it’s a really positive step. I think it’s a big step forward and a victory for the government.”
However, Labour Shadow Chancellor John McDonnell called the sum paid “derisory,” while Margaret Hodge, former chairperson of the public accounts committee that investigated Google’s tax affairs, said: "It feels more like a PR deal designed to counter the reputational damage created by Google failing to pay a fair share of tax on the profits they make from their economic activity in the U.K."