Just over a month after French police raided Google's Paris offices as part of an ongoing tax evasion investigation, their Spanish law enforcement counterparts have conducted a search of Google's Madrid base. Spanish police were reportedly looking for "possible evidence of taxation in Spain that is less than what is appropriate given [Google's] real activity in the country," a source involved in the investigation told the Wall Street Journal, conducting the raid after a request from Spanish tax authorities.
Local media sources report that the Madrid raid — approved in court earlier this week — focused on the company allegedly under-reporting sales tax payments in Spain. Google responded to the raid with a statement. "We comply with Spanish tax laws just as we do in all countries where we operate," a spokesperson said. "We are co-operating with the authorities in Spain in order to answer all their questions, as always."
Google paid the UK £130 million in back taxes earlier this year
Google has offices across Europe, but uses a loophole in international law that allows it to report most of its sales as taking place in Ireland, where it still receives lower corporation tax — an arrangement that has seen it come under fire from a number of European countries. In addition to the Paris raid in May, Google agreed to pay the UK government £130 million ($173 million) in back taxes after an investigation from the country's tax agency, HMRC. The UK government body concluded that the company did not cheat on its taxes, but the final figure handed over has been criticized for being far too small, with shadow chancellor John McDonnell calling it "relatively trivial in comparison with what should have been paid."