Lawmaker accuses Google of tax dodging

2013-06-13 16:33
Google. (Duncan Alfreds, News24)

Google. (Duncan Alfreds, News24)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

London - A key British lawmaker accused search giant Google of dodging its taxes on Thursday, issuing a scathing report that accuses the US internet company of taking on highly contrived arrangements serving no purpose other than to avoid paying its fair share.

The report came after testimony by Google vice president Matt Brittin, who tried to persuade members of Britain's parliamentary Public Accounts Committee that his company was transparent and fair. Committee chair Margaret Hodge rejected arguments that Google's advertising sales take place in Ireland and not the UK.

"Google brazenly argued before this committee that its tax arrangements in the UK are defensible and lawful," she wrote, adding that the "argument is deeply unconvincing and has been undermined by information from whistleblowers, including ex-employees of Google, who told us that UK-based staff are engaged in selling".

Hodge said the government needs to act to shut down loopholes.

"The company's highly contrived tax arrangement has no purpose other than to enable the company to avoid UK corporation tax," she said.

Austerity

Brittin had testified that the company's employees "fully comply with the law".

The tax issue comes at a tough economic moment for Britain, which is struggling with austerity measures that have led to cuts in welfare programs, jobs and government spending.

Like several other multinational corporations, - including Amazon, Facebook and Starbucks - Google's complex corporate structures and disproportionately low tax bills have drawn the ire of a public facing one of the worst economic crises since the Great Depression.

Google has paid less than 0.1% of its billions in UK revenue back to the government in tax. In the first quarter of this year, it made $1.3bn in revenue from the UK, according to a Google release. The company argues that the overwhelming majority of sales actually occur at the company's European head office in Dublin.

The location is important. Brittin told lawmakers in November that sales didn't take place in Britain but in Ireland, where the corporate tax rate is a bargain basement 12.5%. Employees at Google's London office merely promote the company's products, he said, but the sales take place in Ireland.

An investigation by the Reuters news agency cast doubt on those claims, and the committee asked to speak to Brittin for a second time.

Brittin acknowledged that Google employed "people with sales skills", but insisted that those doing the sales are in Ireland.

Hodge rejected the characterisation.

"Google's reputation has been damaged by these revelations of aggressive tax avoidance," she said. "That damage will not be repaired until the company arranges to pay its fair share of tax in the country where it earns the profits from the business it conducts."
- AP
Read more on:    google  |  internet  |  economy
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/Motoring
 

Hottie of the day: Nicole Meyer!

Nicole is the cover girl for the 2014 edition of SA Swimsuit! Check out some smoking hot pics of here here.

 
 

Men24.com

11 things men don’t know about their clothes
Hilarious mortal kombat elevator prank!
This is how the Top Gear presenters spend their £55 million!
Thirty and still single? There’s hope!

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

Save up to 60% on toys!

Don’t miss out on this hot offer, save up to 60% on toys. While stocks last. Shop now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Seen something you like in our catalogue?

Find the perfect gift and save up to R5000 – As seen on the catalogue. Hurry and shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

Up to 35% off books

Save up to 35% on the latest page-turners. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

It may be hard to stay cool, calm and collected. Your emotions can get quite heated in the moment. You may benefit from finding a...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.