Google ‘voluntarily’ pay £130 million ‘tax’

For small businesses and ordinary people, tax is compulsory, for tax dodging corporations like Vodafone, Starbucks, Facebook and Google, it is voluntary.

Google tax dodging

Google tax dodging

It’s unbelievable that big companies like Google ‘negotiate’ the amount of tax they pay. They should be told how much to pay, and made to pay up. Like everyone else. — UK Uncut

A smug George Osborne at Davos said Goggle only paying £130 million tax showed the success of his tax policies.

If an individual or a small business fail to pay tax, they will be prosecuted, forced to pay the tax owed. A small businesses may be forced into bankruptcy by the tax authorises to recover unpaid tax, may face a prison sentence.

One rule for ordinary people, small businesses another rule for the wealthy and global corporations.

From the viewpoint of George Osborne, it is a major success of his tax policy, aiding and abetting the rich and greedy corporations to dodge tax.

HMRC staff who aided and abetted, should be prosecuted for misconduct in public office, a criminal offence that attracts a prison sentence.

A six year investigation into the tax affairs of Google. How much did it cost, has it been published?

And the result, Google ‘voluntarily’ pay £130 million ‘tax’ for ten years of tax dodging.

For small businesses and ordinary people, tax is compulsory, for tax dodging corporations like Vodafone, Starbucks, Facebook and Google, it is voluntary.

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7 Responses to “Google ‘voluntarily’ pay £130 million ‘tax’”

  1. Peter Coulson Says:

    Working backwards, that represents profits of about £650M. If they were operating at 5% NP (which would be good), then that would be £13B turnover in the UK. I wonder what the figures actually are?

  2. keithpp Says:

    I have seen figures cited of Google raking in £4.5 billion a year over the last ten years.

    When you see the puerile argument of what do we cut, if not libraries, is it schools, is it NHS? The argument entirely false. There is the money if lax tax regime dealt with.

    If it was not for the activities of UK Uncut exposing the tax dodging, engaging in occupation of tax dodgers such as Starbucks, Boots and Vodafone, tax dodging would not be on the political agenda.

    To the credit of Jeremy Corbyn and John McDonnell, tax dodging is something they have been raising.

    Corporations are currently sitting on £750 billion cash pile, partly due to lax tax regime, partly they are risk averse and not investing.

  3. keithpp Says:

    John McDonnell writing in the Sunday Times:

    While millions of British business owners and employees were relaxing after another week of working hard and paying their taxes, the news broke on Friday night that Google had reached an agreement with HM Revenue & Customs to pay £130m in taxes for the past nine years.

    George Osborne, needless to say, claims this vindicates the government’s softly-softly approach, but his version of events is already coming apart at the seams.

    The primary difficulty we have is the secrecy that surrounds these deals. In its US accounts, Google declared $35bn of sales in the UK over this period: our country is its largest overseas operation. Market analysts believe Google’s average profit rates are about 25%, which would mean about £6bn in “UK” profit alone.

    On that basis, the £200m total tax paid in this settlement and in the past approximates, in a quick back-of-the-envelope calculation, to an effective tax rate of 3%.

    There is of course room for a lot of error in these estimates before we get anywhere near the tax rates that most businesses in this country pay each year. And in theory there may be perfectly innocent explanations for why the tax take on Google’s operations appears so small. However, the problem is that we just don’t know until we see how these figures were arrived at.

    That is why I have called for the National Audit Office to investigate, as it did after the Vodafone settlement. Furthermore, Google has already been the subject of parliamentary hearings, so clearly elected representatives deserve answers to questions about the agreement. First thing Monday morning, I am going to request that George Osborne give an explanation to the House of Commons.

    The suspicion that the government is planning to announce similar deals in the near future means that a public inquiry may now be urgently needed to look at the whole approach. In addition, my colleague Meg Hillier, who chairs the public accounts committee, has also pointed out that this deal means HMRC is accepting that it has failed to collect the tax due over the past nine years, which is extremely worrying in itself.

    We must never forget why this issue is so important. At a time when George Osborne is cutting public spending, it is incumbent on him to ensure that everyone in Britain is paying their fair share.

    Because how can taxpayers who don’t use aggressive avoidance schemes, whether individuals or decent hard-working businesses, truly have faith that they are being treated properly unless we have a fair, transparent and open system? As it is, those businesses and workers who pay their fair share in taxes shoulder the burden for those who do not.

    Millions of us Britons have no choice about how much tax we pay. It’s deducted at source or reported annually with potential penalties for any mistake. The same goes for millions of UK businesses doing the right thing every year, playing their part in ensuring the public services we all rely on are kept running.

    I have been meeting recently with representatives of small and medium-sized enterprises in Britain, many of whom are deeply concerned about the introduction of online quarterly tax reporting, recently announced by HMRC.

    Particularly for businesses with poor online connectivity, this potentially represents a significant cost in time, with little explanation yet as to how HMRC will help with the transition.

    It comes as parts of the country are recovering from flooding after cuts to flood defences and when there are tragic stories in the news this weekend about the continuing effect of the bedroom tax on individuals, with the loss of a few dozen pounds a week driving decent people to the edge of despair.

    Up and down our country this government is squeezing millions of ordinary people for as much as it can get; then it has the gall to claim victory when a multinational belatedly agrees to pay some of what independent analysts believe it owes.

    The best news in this deal would seem to be the commitment for Google to pay taxes in future, but even this raises concerns. Are future taxes to be calculated on the same basis? Has the government effectively now agreed in perpetuity to tolerate the schemes that have been used in the past? Do we know whether UK sales of advertising are going to be subject to UK corporation tax from now on?

    Any increase in the contribution of large companies whose tax affairs have been questioned is, of course, to be welcomed, but let us make no mistake: this comes as a result of much hard work and campaigning.

    Tax experts, grassroots campaigners and MPs including Jeremy Corbyn and me have spent years raising awareness of these problems.

    If George Osborne implicitly admits we were right at last, that is something to celebrate at least.

    But until we know what has been agreed here and for the future — and until all big companies are paying their share like the rest of us — there is clearly a lot of work still to be done.

  4. keithpp Says:

  5. keithpp Says:

    Unbelievable stupid woman on Channel 4 News interviewing John McDonnell re Google tax dodging. Clearly out of her depth, all she could do was resort to making infantile comments.

    She was equally out of depth last week reporting from Davos.

    Why oh why, did Channel 4 News not have Paul Mason interviewing John McDonnell, at least Paul Mason knows what he is talking about, and it would have been a far more enlightening interview.

    Maybe the stupid woman should join the hacks on The Sun.

    Note: Channel 4 News do not show the interview in full, thus the full extent of this woman’s stupidity does not come across.

  6. keithpp Says:

  7. keithpp Says:

    Google tax deal rapidly unravels

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