French tax authorities are seeking €356 million (approximately US$404 million) from Booking.com, a unit of online hotel reservation company Priceline Group, to recover what they claim are unpaid income taxes and value-added taxes.
In a recent quarterly report, the company disclosed that French tax authorities recently concluded an audit of Booking.com that started in 2013 of the years 2003 through 2012. “They are asserting that Booking.com has a permanent establishment in France and are seeking to recover what they claim are unpaid income taxes and value-added taxes,” the filing stated.
In December 2015, the French tax authorities issued Booking.com assessments for approximately 356 million Euros, the majority of which would represent penalties and interest.
“The company believes that Booking.com has been, and continues to be, in compliance with French tax law, and the company intends to contest the assessments,” it said in a quarterly report. “If the company is unable to resolve the matter with the French authorities, it would expect to challenge the assessments in the French courts.”
Italian tax authorities also have initiated a process to determine whether Booking.com should be subject to additional tax obligations in Italy. Priceline said it “believes that it has been, and continues to be, in compliance with Italian tax law.”
Booking.com is just the latest company to be investigated by French tax authorities in their widening crackdown on tax avoidance. Google’s Paris headquarters are being investigated on similar suspicions.