Google China Accused of Tax Evasion

I first heard about this from post on Shanghaiist, they touch briefly on the tax evasion and on some of the new stuff that google.cn is planning. Which honestly looks like some really interesting stuff, but only time will tell how much it draws the Chinese to the much less favored search engine. More importantly though is the interesting claim by shanghai securites newspaper claiming that China Tax authorities are investigating not only the company but the individual income taxes, the most well known being Lee Kai-Fu the founding president of google china who previously worked for Microsoft. Google denied all claims yesterday, and said that they were late on paying the income tax because they were "consulting the local authorities." It's interesting that Google would even allow this to be happening, I would think with how hard they've worked to follow China's law's that they would either be doing a lot better job of finding loopholes in the tax laws, or being as completely upfront as possible. Overall though I think this will go away without too much of an effect on Google's presence in China, and hopefully the new additions they're planning on rolling out soon will be a big boost.