Rome: Italy is demanding Google pay over 200 million euros ($218 million) in back taxes following an inquiry into its tax arrangements by the financial police, a judicial source said on Thursday.

The technology giant is accused of failing to declare 100 million euros in income and pay 200 million euros in royalty taxes, the source said. Corporate income tax in Italy currently stands at 27.50 per cent, putting the total amount due at 227.5 million euros.