Netflix digs deep to settle tax dispute

Netflix has agreed to pay more than €55.8 million (NZ$92m) to settle a tax dispute with Italy, prosecutors in Milan have announced.

The payment covers taxes, penalties and interest from October 2015 through 2019.

The streaming service also established an Italian legal entity this year. The prosecutors said this would determine its

Italian tax burden, based on subscriptions to Italian residents.

The Milan prosecutors said the investigation was triggered by the physical presence in Italy of technological infrastructure, including 350 servers, aimed at producing revenue.

Netflix officially opened an office in Rome, with about 70 employees, earlier this month.

Netflix said it welcomed the settlement. ‘‘We co-operated with the authorities throughout this investigation and, as we have always made clear, we acted in full compliance with Italian and international tax law,’’ the company said in a statement.