Google’s Madrid office raided amid European investigations into taxes

Tax officials in Spain have raided the headquarters of Google in the city of Madrid as part of an ongoing investigation into tax evasion and fraud.

A spokeswoman for Google said in a statement the company complied with fiscal legislation in Spain just as it did in all countries where it operated.

The news comes just over a month after police and two dozen computer experts raided its Paris offices in a fraud probe. “We are cooperating fully with the authorities in Madrid to answer their questions, as always”, said a spokesman for Google in a statement.

In recent years, many American firms that operate extensively overseas have faced scrutiny in Europe over their tax practices, with tech firms particularly coming under the microscope because of their lucrative online advertising arms.

Sources from the French government have told the media that Google owes them approximately $178 million in back-taxes. The people don’t want to jeopardize the business of these tech giants, but they sure want them to adopt the tax laws of the country they operate in. In Spain, companies operating within the country must declare their earnings there, and it’s suspected that Google might not have declared all of their activity within Spain as actually being in Spain. This January, the tech colossus settled with British authorities on a payment of €172 million in back taxes and agreed to recognize income from advertising booked with United Kingdom companies as subject to British tax. Spanish tax authorities opened an investigation into Google in 2011, with Google eventually paying an extra €1.9 million ($2.1 million) on 2007 and 2008 tax returns.

The raid was approved by a court in Madrid, Reuters reported, following a request by the Spanish tax authorities.

The European Union’s executive arm has also been investigating alleged sweetheart tax deals enjoyed by Amazon.com Inc. and Apple., cases that could lead to orders to repay years of back taxes. The UK office is even based out of Ireland to avoid the larger taxes on the mainland.