Erin Seils|
Taxes are something that nobody likes but everyone has to pay. Or so we thought. Google and many other well known corporations, such as Starbucks and Amazon, are somehow managing to avoid them.
Google has agreed to pay £130 million in back taxes from the last decade to the UK treasurer. Many politicians. as well as members of the public, strongly believe that this is nowhere near the amount that the company, worth $527 billion (£366 billion approximately), owes Britain in taxes.
Eric Schmidt, Chairman of Google, even admitted that he was “proud” of the way the company had managed to lower their tax costs. Their methods were simply “capitalism” according the chairman of the multi-national company.
The debate between Google and the UK over taxes did not only start in the last month. Eric Schmidt, who was CEO of the world-wide company between 2001 and 2011, was interviewed in 2013 on BBC Radio 4.
“What we are doing is legal. I’m rather perplexed by this debate, which has been going in the UK for some time, because I view taxes as not optional.
I view that you should pay the taxes that are legally required. It’s not a debate. You pay the taxes.
If the British system changes the tax laws, then we will comply. If the taxes go up, we will pay more, if they go down, we will pay less. That is a political decision for the democracy that is the United Kingdom.”
John McDonnell, Shadow Chancellor of Exchequer and British Labour Party politician, appeared on BBC Newsnight, saying that the payout by Google had not impressed him.
“Independent assessors have assessed it at about 3% and in comparison with that, the corporation tax during this period was between 20 and 30 percent. So, other tax payers, particularly businesses in this country, I think will be quite startled and offended by this.”
The politician is obviously not the only one with this perspective as online petitions have been created on 38degrees.org.uk. One petition that was set up after Google paid just £6 million in taxes to the UK in 2011, has collected 50,577 signatures so far. Some people were quite enraged with the company’s tax avoidance.
“I, as for many others are dropping Google, why ? ..attitude to customers and american greed.”
“I pay tax, so should you!”
Another petition that was posted on 38degrees, titled “STOP GOOGLE’S MASSIVE TAX DODGE”, has been commented on in the last few days.
“If Italy can secure a much bigger tax payment from Google, why has the UK settled for so much less?”
“Man up, Google!”
“Monster companies like this should be fined for taking more in credits than they pay in tax! While our NHS suffers.”
This campaign has received 136 out of the 200 signatures needed so far and this amount is increasing at a fast rate, showing that many people agree with the Shadow Chancellor.
Although it is HMRC (Her Majesty’s Revenue and Customs) that deals with collecting tax , John McDonnell was not the only politician with something to say about the “sweetheart” deal that Britain has made with Google.
Prime Minister David Cameron has spoken in defence of the deal that UK authorities and Google executives have agreed upon, saying that “no government has done more than this one to crack down on tax evasion and aggressive tax avoidance”.
While there is still a lot of controversy over how much the corporation owes Britain, Google has said that £130 million is the “full tax due in law”. Whether this is true or not, we can expect to see further debate over the next few days and the mention of some other international companies, that have been caught dodging tax in the past, is not unlikely.
