Indonesia's tax office wants Google to pay over $400 million in back taxes

Indonesia's tax office has charged Google with an $18 million fine over the company's tax avoidance in 2015.

Google could be facing fees of over $400 million in Indonesia where one of the country's officials has accused the company of tax avoidance.

Muhammad Hanif, who works for Indonesia's tax office special cases branch, revealed that the authorities have visited Google and believe the company's tax avoidance has been ongoing over the last five years.    

The company had previously turned down a request by the Indonesian government to be audited. Google was then under investigation by the country's tax officials who accused it of failing to pay taxes during the 2015 calendar year. Now the company is facing a fine that is equivalent to four times the taxes it should have paid last year, which amounts to $418 million.

If the tax office finds out that Google had avoided paying taxes before 2015, it could face further penalties. A spokesperson for the company defended its position, saying: “Google Indonesia has been incorporated as a local company in Indonesia since 2011. We have been and will continue to cooperate with the government and have paid all applicable taxes in Indonesia.”

If Google does find tax-related problems in East Asia then it would be in a similar position to Apple, which was recently accused of skipping out on paying billions in taxes  in Indonesia. Apple itself is facing a great deal of its own difficulties after EU authorities charged the company with a $15.5 billion fee.

It is still up in the air regarding if Google will have to pay Indonesia's hefty fee but the situation is one that could motivate other companies to look into their own bank ledgers with clean eyes in order to prevent falling into the same position as Apple and now Google currently find themselves. 

Image Credit: Denis Linine / Shutterstock

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Anthony currently resides in South Korea where he teaches and experiences Korean technological advances first hand.