About 100 French tax officials and IT experts raided the Paris offices of US internet giant Google as part of an investigation into almost AU$2.5 Billion in unpaid taxes.

"We comply with French law and are co-operating fully with the authorities to answer their questions," read a statement from Google.

This raid comes as the tax arrangements of major corporations in Europe are coming under more scrutiny.  In Google's case, the company keeps its European headquarters in the Republic of Ireland, which has the lowest corporate tax rate in the region.  But to investigators, it sure seems like Google is doing a lot of business in France:

"The investigation aims to verify whether Google Ireland Ltd has a permanent base in France and if, by not declaring parts of its activities carried out in France, it failed its fiscal obligations, including on corporate tax and value added tax," the prosecutor's office said in statement.

The UK had similar suspicions about Google, but in January struck a deal in which the company will pay an extra AU$265 Million in tax for the period from 2005, but that deal was heavily criticized.  Even the Parliament Public Accounts Committee said it was disproportionately small compared with the size of its UK business.