Google UK Paid Only £600k Taxes On £1.25 billion Turnover
This morning I was reading how the UK Government are considering the introduction of a Search Engine Tax as a way of propping up the ailing Public Service Broadcasting.
I thought this was a bizarre idea until my research led me to read a Times article that claimed global search giant Google is using a number of loopholes to avoid paying up to £100 million in UK taxes.
The article revealed that in 2007 Google paid only £600,000 to HM Customs And Revenue on a turnover of £1.25 billion. Straight away you ask yourself, how can they get away with that, and why are they allowed to?
I’m no tax expert but here’s the long story short.
London based Google UK Ltd channel 90% of their revenue through a subsidiary in Ireland. British firms which advertise with it pay their subscriptions to the Irish based company where corporation tax is levied at 12.5%, compared with 28% in Britain.
The Sunday Times also revealed Google avoided a further €135m (now £119m) in tax from Ireland during 2007 because the search engine’s Irish subsidiary is owned by one of two companies Google has set up in the tax haven of Bermuda.
Vince Cable, the deputy leader of the Liberal Democrats, said: “Google is another in a long line of companies who seems to think that paying British taxes should be optional.
On the other side of the political divide both the Conservatives and Labour seem to be hopping in and out of bed with Google’s top brass if the facts of the article are true.
If Google are hit with a multi-million ‘per click’ tax to help make sure programmes like news and current affairs continue to be made then they’d get no sympathy from me.
Posted on May 3, 2009 | Filed Under Tech
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