Google Faces £1.3billion Tax Bill In France

Google makes about ten per cent of its global revenue in Britain and plans a £1billion London office for 5,000 staff.

The £130million settlement covered back taxes owed from as long ago as 2005.

Google is facing a £1.3billion tax bill in France it emerged yesterday prompting more questions over why Britain asked the company to pay just £130million.

The web giant uses avoidance measures to limit its contributions, was warned there will be no negotiations over its debt across the Channel.

It came as the UK’s settlement hailed last month as a victory by chancellor George Osborne was dismissed as ‘disproportionately small’ in a report by MPs.

The public accounts committee, whose members grilled Google bosses two weeks ago, said the taxman ‘appears to have settled for less’.

Chairwoman Meg Hillier said ‘HMRC said it was cost-effective to secure a deal for £130million.

Even if the French don’t get all the money they’re asking for, this calls into question their approach.

Britain is Google’s biggest market outside the US. Our committee has been worried the deal HMRC struck lacks transparency.’

The committee’s report criticised HMRC for spending six years on ‘a very expensive and resource-intensive’ investigation before reaching the deal.

The taxman ‘seems unable to collect a fair share’ of tax from global companies because international rules are not working, the MPs said.