Google Offices In Spain Reportedly Raided Over Fraud And Tax Evasion Suspicions


Google's offices in Madrid were raided by Spanish authorities as part of an action that probes for tax evasion and fraud.

Local news outlets report that the raids that hit Google's headquarters and the Google Campus are related to VAT payments and non-residence tax. Simply put, the authorities suspect that Google omits declaring its whole business that takes place in Spain, thus falling short on its fiscal duties.

A spokesperson from Google refused to answer detailed questions about the raid, but provided a reassuring statement.

According to the spokesperson, Google complies with tax law in Spain, just as it does with the identical laws from other countries where the company operates.

"We are cooperating fully with the authorities in Madrid to answer their questions," Google says.

Last month a similar raid took place in France where local authorities swooped the Paris offices of the company. The French raid was also part of an investigation searching for proof of tax evasion. The operation in Paris was under preparation for about a year, and Google could face a hefty fine of $1.8 billion, should the evidence stand against it.

As most tech companies from the United States, Google ties its European business ends in Ireland, where it has its headquarters. The country has one of the most attractive corporate tax policies in the European Union, which explains Google's strategy.

In recent years, political and public criticism reached new heights concerning businesses that consistently draw profits from a country and report them into another. This pressure causes tax authorities to act robustly, and it seems that the Spanish and French tax collectors are already at it.

At the start of the year, Google inked a deal with the authorities in the United Kingdom, after the company admitted to having shied away from paying its full taxes for about 10 years. In compensation, Google will give $185 million to the UK.

The $185 million (£130 million in local currency) includes not only the taxes Google evaded since 2005, but accounts for the interest accrued on the amount.

The public opinion criticized the authorities at the time, underlining that the "sweetheart deal" is a poor example of leadership. What is more, the sum was considered insignificant by those who were familiarized with Google's turnover.

At the last earnings report, dating April 2016, the company counted its global revenue at $20.26 billion for the first quarter.

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