Feeds

Google may face grilling by MPs over 'immoral' tax avoidance

Politicos rattle sabre

Secure remote control for conventional and virtual desktops

Google could be hauled in front of MPs after the 2011 results for its UK subsidiary showed it paid £6m in corporation tax.

John Mann, an MP and member of the Treasury Select Committee, suggested the advertising giant should explain itself for its "entirely improper and immoral" behaviour.

"This is a company avoiding its obligations and we are letting them get away with doing it," he thundered to The Independent.

"I think it would be highly appropriate to pull a Google executive in front of the committee to justify their failure to pay proper taxes, we would be looking at covering the issue in this parliamentary session, so before Easter, realistically.

"Whether it is illegal or immoral, the British tax payer loses out. Google is one of the big ones but there are others."

A spokesperson for the committee told The Register that there were no firm plans to take the Chocolate Factory to task just yet. Parliament is not in session at the moment and won't be starting up again until September, when discussions will take place, they added.

Google UK does a tax tap-dance to shuffle its money from place to place and avoid heavy duties. The Blighty unit is employed as an agent of Google Ireland, shunting its money over there, which in turn pays its money on to the Bermudan branch of the internet giant, leaving the bulk of earnings in a tax haven. The UK business ends up with a commission fee of ten per cent, which is the bit that gets taxed in Britain.

The corporation tax rate in the Irish Republic is 12.5 percent whereas it's 24 per cent in the UK for a company the size of Google.

The company recorded a UK turnover of £395m in 2011, up from £239.4m a year earlier and an overall loss of £24m, on which the corporation tax was calculated, compared to losses of £27m in 2010.

Google reported admin expenses of £416.8m, including advertising and promos, stock-based compensation costs and employee benefits costs.

The firm said in an emailed statement that it makes a "substantial contribution to the UK economy through local, payroll and corporate taxes".

"We also employ over a thousand people, help hundreds of thousands of businesses to grow online and invest millions supporting new tech businesses in East London. We comply with all the tax rules in the UK," it added.

While it might be legal to have different subsidiary units employing each other and thereby escaping high taxes, it's the sort of behaviour that has enraged the general public since the global downturn.

An online petition to make Google pay its "fair share", run by campaign community 38 Degrees, has already reached nearly 45,000 signatures. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Lords take revenge on REVENGE PORN publishers
Jilted Johns and Jennies with busy fingers face two years inside
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Yes, yes, Steve Jobs. Look what I'VE done for you lately – Tim Cook
New iPhone biz baron points to Apple's (his) greatest successes
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Edward who? GCHQ boss dodges Snowden topic during last speech
UK spies would rather 'walk' than do 'mass surveillance'
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.