Google avoids €1.1bn fine in French back-taxes case

US tech giant Google has been handed a reprieve by a French court after the tax authorities in the country accused it of underpaying taxes to the tune of €1.1bn.

In a major victory for the search engine’s parent company Alphabet in a six-year long case related to its tax practices in France between 2005 and 2010.

The French tax administration claimed Google had been selling its services in the country through its Irish subsidiary, but a court ruled that the income made from the services was not taxable there.

“The Irish company Google Ireland Limited is not taxable in France over the period from 2005 to 2010,” the court said in a statement.

US tech firms have been keenly pursued by tax authorities in Europe in recent times for channelling income through low-corporation tax states such as Ireland.

Just last year, Google was ordered to pay back £130m in taxes to the British government after its fiscal practices were criticised by MPs.

The European Commission compounded Google’s woes earlier this year when it was hit with the largest antitrust fine in its history for favouring its online shopping service through its search engine.

Alphabet was fined €2.4bn for promoting its own shopping comparison site over competitors.