A report by the news agency Reuters has said that Google is being investigated by the authorities in France in relation to how French advertisers on the site pay their taxes in France.
Google currently charge advertisers in France using a company based in Ireland and the French authorities are keen to gauge if this is a deliberate attempt by Google to avoid or underpay their taxes in France.
According to Reuters Google in France in 2010 registered sales of €69.7 million which led to the company paying a total of €2 million in taxes on only €4,4 million of its income.
Experts are saying that the French authorities are now working on gathering as much information as possible about the dealings of Google in France with the belief that the internet giant should be paying far higher taxes in France.
Jerome Cahuzac, the minister responsible for the budget in France has said that Google have been asked by France to sort out the problems concerning the payment of tax in France and if this is not resolved then the company could see itself in court in France.
He added: “Evidence shows a business activity based in France that is incontestable.”
This latest demand from the French authorities comes after investigations into the company first began in June.
Three of the offices run by Google in Paris were searched earlier in the year with computers being seized by the authorities as part of their ongoing investigation into Google.
However, Google are maintaining that the company has not acted to try and avoid paying any taxes in France.
A statement from Google said: “Google conforms with the tax laws in all the countries where the company operates. We cooperate with local authorities and we work with them to answer their questions about Google France and our services.”
Google is also facing investigations in Britain and Germany while in the US the company is also under fire for how it operates its search engine and there are investigations into if their providing free Android software to phone companies is against the rules of competition.
Margaret Hodge, the Chairman of the PAC, has spoken out about the practices of Google saying “We’re not accusing you of being illegal, we are accusing you of being immoral.”