No more tax privileges for US companies in Europe?

“These searches are the result of a preliminary investigation opened on June 16, 2015 relative to aggravated tax fraud and organized money laundering following a complaint from French fiscal authorities,” the prosecutor’s office said in a statement after French police raided Google’s Paris offices on May 24, 2016.

A similar raid had already taken place in June 2011 within the framework of a fiscal investigation and internet giant Google is once again being accused of having failed to meet its fiscal obligations by not declaring some of its activity on French soil conducted through its Ireland-based European headquarters with a view to lowering the company’s French tax burden.

According to French authorities, Google could owe up to USD 1.7 billion in back taxes. Google affirmed it is cooperating and complying with French law, yet it recently agreed to pay around USD 190 million to the UK on the basis of similar accusations. Considering the very heavy fines paid by European companies to the US government in recent years, many hoped that the European Union (EU) and its member states will act rigorously as well.