The French tax authorities are set to demand €1.6bn (£1.3bn) in back taxes from Google, a move likely to bring pressure on HMRC which claimed just £130m, and amount which the Public Accounts Committee (PAC) described yesterday as ‘disproportionally small’ in relation to Google’s business activity in the UK
The sum was cited in a comment by a senior French official to the news agency Reuters.
Neither Google France nor the French tax authority has confirmed the amount, and the internet giant said in a statement that the company obeyed tax rules in all countries where it operated.
If confirmed, the disparity between the UK and French settlements is likely to bring pressure to bear on HMRC to take another look at Google’s tax payments.
In its latest report, PAC said it expects HMRC to ‘monitor the outcome of other tax authorities' investigations into Google, and re-open its settlement with Google if relevant new evidence becomes available.’
Giving evidence at a PAC session earlier this month, HMRC chief executive Dame Lin Homer denied accusations that the UK tax authorities were ‘out manoeuvred’ by Google in reaching a £130m agreement on back tax due, and said that if any ‘material information’ subsequently became available which had not been disclosed, then HMRC would re-visit the inquiry.
At the time, Homer said that HMRC was in ‘regular conversation’ with counterparts in those countries and elsewhere, and if new facts came to light, then the inquiry would be re-opened. There was no time limit on when this could happen, she said.
