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Head of Google in Europe Questioned About Taxes in Britain

Google's Northern Europe boss Matt Brittin leaves a British parliamentary Public Accounts Committee inquiry into tax avoidance at Portcullis House in London, May 16, 2013.

Members of Britain's Parliament questioned the head of Google's European operations Thursday on whether the Internet giant had paid its fair share of taxes.

Thursday’s hearing follows a public outcry about a tax settlement the company made with U.K. authorities, which some people say is unfair. Google has agreed to pay about $187 million covering a 10-year period.

Public Accounts Committee Chairwoman Meg Hillier reflected the public mood when she accused Google's Matt Brittin of having “tin ears,'' to the complaints about the back taxes deal in Britain.

Brittin said he understood the public anger, and said Google had paid taxes at a 20 percent rate in accordance with the law.

"It's important to understand that, and I think the committee raised this last time, you wrote a report after we appeared last time suggesting two things, one we should look at our tax structures which the HMRC (Her Majesty’s Revenue and Customs) has done and second, that we should pay tax proportionate to our UK sales. If those were the rules, that's what we would do, but those are not the rules, the rules are you should pay taxes on the profit on the economic activity which is at the heart of what HMRC looked at.”

But Brittin drew a strong reaction from Hillier when he said he did not know his own pay package.

“You don’t know what you get paid? … Out there, taxpayers, our constituents, are very angry, they live in a different world clearly to the world you live in, if you can't even tell us what you are paid," Hilier scolded.

Meanwhile, Italy has opened a tax probe into allegations the firm evaded taxes worth over $257 million.

Lawmakers across Europe are attempting to change tax rules that allow multinational companies to transfer untaxed profits into low-tax jurisdictions.

Tax authorities in some countries, including Italy, are also trying to use existing tax laws to make companies pay more tax on the profits generated by sales in their countries.