Punish Google Tax Dodging and Sink The Corporate Pirates
Search Engine giant Google has a well known aversion to paying
national taxes to the tax regimes of nations in which it operates. In
fact Eric Schmidt, the company’s executive Chairman and former CEO is
on record as having said nations should pay Google for what its adds
to the national community. As a former Information Technology
consultant who was involved in the very early days of inter –
networking technologies I would dispute that, all Google has done
works towards handing control of information to government agencies
and corporate pirates.
Apart from that, Google’s main achievement has been in the
advancement of sophisticated tax avoidance strategies. Since the
amounts of corporate tax paid by the national operations of
Google and other global corporations, especially those in the
internet technology sector such as Facebook, Amazon, Microsoft and
Verizon in the world’s largest economies has come to light there has
been a public backlash against corporate piracy. Piracy may seem a
strange term to use, conjuring up images of Johnny Depp or Errol
Flynn, but the corporate tax avoiders are plundering our national
treasuries just as Blackbeard and Captain Kidd used to plunder the
shipping routes. Let them be known for what they are.
The UK tax authority revealed recently that it had agreed a
settlement with Google for the internet search company to pay
back-taxes of £130 million (US$186million), despite its British
operation racking up profits of US$8.6 billion over past ten
years, a tax rate of just 3 percent.
Stewart Hosie, deputy leader of the Scottish National Party,
commented "there is a palpable sense of skepticism amongst the
public, experts and even within the Conservative Party, that the tax
settlement reached with Google represents value for the taxpayer".
"The truth is that we know very little about the settlement
reached between the tax authorities and the company. These
discussions have taken place in private, little detail has been
revealed by the Treasury and the methodologies employed by HMRC are
shrouded in secrecy."
While we can understand and support this view from the Sottish
nationalists, the line take by the Labour party as the official
opposition in the UK parliament, that the Conservative government
collaborated to minimise Google’s tax liability is a little harder to
swallow when we remember that Google paid no
corporate taxes at all from 2002 to 2010 when The Labour Party
were in power.
It has also been revealed that Italy
is set to charge Google US$161 million in back-taxes over its
US$1.43 billion revenues – equating to 15 percent – five
times more than the UK.
"The Government must restore public confidence that they have
acted in the best interests of the public and have secured a good
deal for taxpayers across the UK. They must also answer the charges
that the methodology used by the HMRC to calculate future liabilities
is opaque, and a potential breach of very clear EU regulations on
calculating the tax liabilities of large corporations," Mr.
The French are also negotiating a tax deal with Google which could
show a different rate of taxation for corporations with links to the
US Government, further highlighting the omnishambles of the European
Union tax system. One corporate tactic that should be opposed is the
very predictable threat to cease operations in nations that require
the global corporations to accept local tax laws.
And another step in bringing these legal, but unethical, tax
avoiders to heel is for ‘We The People’ to boycott their businesses.
There are other search engines, other coffee chains (or better still,
if you can find one, use an independent coffee shop, get a better cup
of coffee and support local businesses).