France demands $1B from Google; tech giant accused of tax evasion

The French government is going after Google for $1 billion it believes the tech giant owes in taxes.

French tax authorities have been in contact with the company about the payments in question, adding that penalties for non-compliance may also be in order, technology website Ars Technica reported Friday.

The Direction Générale Des Finances Publiques — the French equivalent of the IRS — appears to be upset over Google’s ability to categorize work done in France as services rendered for Irish contracts, Ars Technica reported. Ireland’s corporate tax rate is 12.5 percent; France’s stands at 33 percent, Yahoo Finance reported.

Google, however, believes that its position is sound.

“In March 2014, we received a tax assessment from the French tax authorities,” Google wrote in its earning report, Ars Technica reported. “We believe an adequate provision has been made and it is more likely than not that our tax position will be sustained. However, it is reasonably possible that resolution with the French tax authorities could result in an adjustment to our tax position.”