Agents of special tax fraud unit have raided McDonald’s premises west of Paris, seizing company files, police sources say. French authorities suspect the company of avoiding taxes by sending earnings to Luxembourg.
Investigators are looking into allegations of aggravated tax fraud and money laundering, the French prosecutor’s office said on Thursday.
The police searched McDonald’s national headquarters last week, seizing a number of documents at the offices in Guyancourt, west of Paris. Previously, trade union representatives filed a complaint accusing the company of organized tax evasion.
French authorities suspect the burger chain of illegally cutting down its tax bill by transferring money to its European parent company in Luxembourg, where taxes are lower.
The scheme allegedly allows McDonald’s France to save about 75 million euros ($84 million) in taxes every year, according to the union representatives. Last month, business magazine L’Expansion said that the government had sent the company a 300-million-euro bill for unpaid taxes, including 100 million in fines.
McDonald’s France has denied any wrongdoing. The officials claim that their French branch transfers money to Luxembourg to pay its parent company for rights of use and expertise fees.
On Thursday, the burger chain told the AFP news agency that it had “spoken at length on the issue” and had “nothing to add at this stage.”
The multinational giant is only one of several large firms to be scrutinized for fraud and tax evasion in recent months.
Earlier this week, French police also raided Google’s offices in Paris. The authorities suspect the multinational company of owing 1.6 billion euros in taxes.
During a February visit to Paris, Google CEO Sundar Pichai defended the Internet giant’s tax practices.
“We’re a global company. We have to abide by tax laws everywhere, and we do abide by local tax laws in every single country,” he said.