Google Avoids Paying $1.6 Billion USD In Taxes, UK PM Speaks Out
January 2, 2013 11:32 AM
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David Cameron, the Prime Minister of the UK, said that companies like Google are immorally minimizing tax bills
Google has managed to skip paying about $1.6 billion USD (£1 billion)
by way of the island Bermuda -- and the Prime Minister of the United Kingdom isn't happy.
Google sent £6 billion through Bermuda over the course of last year, which halved its 2011 tax bill. In fact, Google funneled 80 percent of its global revenue through the island and ended up paying about £1 billion less to the government.
Google's Executive Chairman Eric Schmidt said this "is called capitalism."
“We pay lots of taxes; we pay them in the legally prescribed ways,” said Schmidt. “I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate.”
David Cameron, the Prime Minister of the UK, said that companies like Google are immorally minimizing tax bills and need to be stopped. He even wrote a letter to fellow leaders of the G8 requesting a global crackdown on tax avoidance for large companies such as Google and Starbucks.
“I do believe we all have a common interest in being able to tell our taxpayers who work hard and pay their fair share of taxes that we will make sure others do the same,” wrote Cameron in an open letter to the G8.
Google's UK Head Matt Brittin said politicians are the ones who set tax rates, and that Google is playing by their rules.
Google funneled £2.6 billion of British revenue through Bermuda, which cut its UK tax bill by £200 million.
In April of last year, it was reported that
Apple made $9.5 billion USD
in Britain for 2011, but only paid 0.16 percent in taxes. Amazon was also targeted for its
headquarters in the tiny European Union nation of Luxembourg and Google's placement in
Ireland with subsidiaries in the Caribbean and Luxembourg for more tax dodging gains.
The New York Times
blamed Apple for dodging billions in taxes
in a lengthy article last year.
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RE: two faced
1/5/2013 1:08:39 PM
Agreed. We should all aim to maximize, not minimize our tax burden, in the name of the state. Good businesses shouldn't aim to minimize their expenses by legally gaming the system that politicians created, politicians who later decided the system they created is unfair. Businesses should be demonized for this insane action, not the politicians who created the system and later disliked the system they created.
Get real. Google is very much open about their tax advantaged planning. They want to make money, and make as much as possible, which is what a business aims to do. If governments want more of that money, the LEAST they could do is to create a loophole free system to collect it.
Politicians complaining about tax loopholes to me is equivalent to a boat maker building boat after boat with holes in it and complaining about the sea sinking all of his/her ships.
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