Google bullish about profits
Multi-nationals have come under fire recently for their totally legal tax practices and have been doing some hasty PR work to look conciliatory. Not so Google's Chairman, Eric Schmidt, who told Bloomberg "It's called capitalism. We are proudly capitalistic."
The UK is a huge marketplace for Amazon and it accounts for as much as 25% of Amazon's sales outside the US. Nowadays it is far more than a bookshop, and to give some idea of the scale of its UK operations, it has taken on 10,000 temporary staff to cope with Christmas orders. But somehow its taxes ended up being paid in Luxembourg where the rate is much less than the UK's.
Google's accounts for last year show £2.5 billion of sales in the UK and a profit margin of 33%. However, it paid only £3.4 million in UK taxes. Matt Brittin, the head of Googles Europe operation, told the Public Accounts Committee that Google routes its profits via Ireland and Bermuda because they offer attractive tax rates.
Perhaps we should ask the Public Accounts Committee and HMRC why it has taken them so long to address this issue. Its not new. For instance, two years ago, in October 2010, we published an article in this newsletter about how Google had saved itself over three billion dollars in tax since 2007.
Double Irish and a Dutch Sandwich
www.skillzone.net/newsletter/34-3-Double-Irish-and-a-Dutch-Sandwich
17th December 2012