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Google only paid £6 million ($7.8 million USD) in UK corporation tax

The United Kingdom isn't happy with Google's corporate tax record, but executive chairman Eric Schmidt said that Google is responsible for significant economic growth in the country.

The UK has said that it is "immoral" for multinational companies like Google to pay such low taxes on their earnings in the UK. Leaders in the UK, France and Germany have all called for a way to stop profit shifting by multinationals, which is used to dodge taxes.

The UK is especially concerned with the fact that Google only paid £6 million ($7.8 million USD) in UK corporation tax. 

Google executive chairman Eric Schmidt defended his company's tax record, saying that Google has complied with the law and has even helped stimulate growth in the UK.

"Britain has been a very good market for us," said Schmidt. "We empower literally billions of pounds of start-ups through our advertising network and so forth. And we're a key part of the electronic commerce expansion of Britain, which is driving a lot of economic growth for the country."

"I think the most important thing to say about our taxes is that we fully comply with the law and we'll obviously, should the law change, we'll comply with that as well."

Back in January of this year, Google was criticized for skipping out on paying about £1 billion ($1.6 billion USD at the time) in UK taxes. It did this by funneling a large portion of its global revenue through the island of Bermuda. 

Google sent £6 billion through Bermuda over the course of 2012, 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.

“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 UK Prime Minister David Cameron in an open letter to the G8.

Schmidt defended Google at that time as well. 

“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.”

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.

Source: BBC News

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RE: Right and Wrong vs Legal and Illegal
By nafhan on 4/23/2013 7:14:34 PM , Rating: 2
Corporations are not people (or moral entities) they are legal frameworks for distributing risk. They can't do anything "wrong". They can only engage in legal or illegal activities.

Politicians talking about right and wrong in this regard = (probably) politicians trying to blame someone else for their problems.

RE: Right and Wrong vs Legal and Illegal
By jRaskell on 4/24/2013 12:03:17 PM , Rating: 2
So Enron did nothing wrong?
Lehman Brothers did nothing wrong?

You're right that corporations are not people, but they are run by people. corporations don't DO anything at all, right or wrong, legal or illegal. They don't engage in any activities. It's the people operating within them that do anything. And when anybody talks about what a corporation does or doesn't do, it's quite clear they are actually talking about the people running that corporation. At least, it's clear to anyone with a modicum of reasoning.

By nafhan on 4/24/2013 1:22:13 PM , Rating: 2
That depends on how you define right and wrong. What matters is that they did something illegal.

In my experience, discussions involving "right and wrong" are most often used in the context of swaying someone to your point of view rather than attempting to convey information.

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