China claims Google companies broke tax laws

China has accused three companies linked with Google of breaking tax laws and avoiding tax payments, according to a Chinese newspaper.

The Economic Daily ran a story that alleged that three “Google enterprises in China”, including one Google Information Technology (China) Company Ltd., had made false tax claims to the value of $6 million, along with other allegations of tax evasion.

Reports suggested that the three companies had already been investigated and reprimanded, but that further investigations were ongoing. It is not clear if these are Google companies or partners, particularly considering two of them do not bear the Google name.

We asked Google if it has had difficulties with Chinese authorities on the issue of tax. A spokesperson for the company told us, "We believe we are, and always have been, in full compliance with Chinese tax law."

When probed about its strained relationship with China, Google refused to comment, which is remarkably contradictory to its vocal stance on China over the past year.

The two have been at each other's throats since Google threatened to pull out of China altogether after an alleged government-funded hacking incident of Gmail accounts. Further spats between the two occurred over subsequent months relating to Google's licences, but all of this pales into insignificance compared to accusations of tax impropriety.