PARIS — A storm is brewing in Europe as nations try to force Internet powerhouses such as Google and Amazon to pay more in taxes.
Governments, hungry for money to prop up their struggling economies, are accusing the technology giants of incorporating themselves in low-tax countries so they can avoid paying hundreds of millions of dollars to countries such as Germany, Britain and France — where most of their European income is derived. In Britain on Monday, a lawmaker pushing to tighten laws said the multinationals’ ability to escape corporate taxes “is outrageous and an insult to British businesses and individuals who pay their fair share.”
According to court documents, French authorities raided Google’s offices in Paris over the summer and seized documents in a tax dispute. More recently, according to a published report, the French government presented Google with a $2.18 billion tax bill; Amazon acknowledged one for $252 million. Facebook is also in the line of fire.
But there is nothing illegal to the multinationals’ actions. Thanks to the way the European Union is run, companies operating in Europe can base themselves in any of the 27 member countries, allowing them to take advantage of a particular country’s low tax rates.