Google won't pay $1.3 billion in back taxes to France

PanARMENIAN.Net - Google won its fight against a 1.12 billion-euro ($1.3 billion) French tax bill after a court rejected claims the search-engine giant abused loopholes to avoid paying its fair share, Bloomberg reveals.

Google didn’t illegally dodge French taxes by routing sales in the country out of Ireland, the Paris administrative court decided Wednesday, July 12. Judges ruled that Google’s European headquarters in Ireland can’t be taxed as if it also has a permanent base in France, as requested by the nation’s administration.

“Google Ireland Ltd. isn’t taxable in France over the period 2005-2010,” the court said in a statement. French tax administrators didn’t immediately respond to requests for comment.

In a parallel criminal case, French prosecutors raided the Alphabet Inc. unit’s Paris office in May 2016 after months of preparation spent offline to prevent leaks. That ongoing probe seeks to verify whether Google’s Irish unit has a permanent establishment in France and whether the firm failed to declare part of its income in the country.

“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.”

The win for Google comes as France’s newly elected President Emmanuel Macron vowed to make the country “a startup nation” and pledged in June to create a 10 billion-euro fund to help finance innovation. Weeks later, French billionaire entrepreneur Xavier Niel unveiled a gleaming startup incubator in Paris to host his ambition to put the city on par with Silicon Valley for technology investment and to produce the next Facebook.