US internet company Google has agreed to pay 326 million euros to settle a tax dispute with Italian authorities. Reuters reports today that the company owed taxes from 2015 to 2019, citing a statement from the Milan prosecutor’s office.
Penalties and Interest on Google’s Non-Compliance
The agreement includes penalties, interest, and additional charges due to Google’s failure to comply with Italian tax regulations. According to the prosecutors, Google Ireland Limited, incorporated under Irish law, failed to submit an annual declaration of income earned in Italy during the period from 2015 to 2019. This omission was particularly related to income generated “through the sale of advertising space” to Italian businesses.
The Italian authorities argue that this lack of transparency deprived the country of the tax revenue it was entitled to, prompting the hefty settlement. The penalties reflect the severity of the violation, which also included interest on the unpaid taxes. This latest agreement further highlights ongoing tensions between major tech firms and European tax authorities.
Previous Fines and Ongoing Legal Issues in the EU
The Italian authorities had already fined Apple and Google €20 million in November 2021, which the two companies shared equally. At the time, it justified this on the grounds of aggressive practices in the use of consumer data for commercial purposes. Earlier in May 2021, the Italians fined Google €102 million for abusing its dominant market position.
Google has already received multiple fines in the European Union for competition violations. Last September, the European Union’s highest court upheld a €2.42 billion fine for abusing its dominant position in the price comparison market. The case had dragged on since 2017.
