Google has agreed to a tax settlment a £259 million, ending a legal dispute with Italian authorities. Settling the tax dispute has now brought an end to a criminal investigation into alleged tax avoidance for over a decade.
The settlement is considerably higher than the £130 million pay out that the UK secured in unpaid taxes from Google last year. At the time Chancellor George Osborne was criticised for letting Google off lightly. The fact that Italy has secured a settlement almost double that paid to the UK only supports those criticisms.
Italy’s tax agency said: "We have also begun the process of drawing up an agreement that will ensure Google pays the correct taxes in Italy in the future."
It comes just two years after Apple coughed up €318 million for taxes owed to the Italian authorities. Italy has also begun proceedings against Amazon, which it estimates could owe taxes on €130 million misappropriated funds.Pressure from the European Commission has heaped pressure on technology giants to pay back taxes avoided since the year 2000 by moving income in countries such as Ireland and Luxembourg.
Google is now facing a similar tax case in France with the authorities claiming it owes them €1.6 billion in unpaid taxes. However, French finance minister Michel Sapin has said he will not broker a deal with Google and will instead pursue legal action against the firm.