Slashdot Mirror
In Australia, Google Pays Just $74k Tax On Claimed Revenues of $200 Million
daria42 writes "Looks like Apple isn't the only company with interesting offshore taxation practices. The financial statements for Google's Australian subsidiary show the company told the Australian Government it made just $200 million in revenue in 2011 in Australia, despite local industry estimating it actually brought in closer to $1 billion. The rest was funnelled through Google's Irish subsidiary and not disclosed in Australia. Consequently the company only disclosed taxation costs in Australia of $74,000. Not bad work if you can get it — which Google apparently can."
This is just part of the campaign to tar Google with any brush they can. Read this.
Help stamp out iliturcy.
Corporation tax is charged against profit, not revenue.
A successful, well-run company can easily have a profit of $1 on revenues of billions and therefore pay only 25 cents tax.
If a company is making millions and billions in revenue it usually indicates that they are ( 1 ) not paying realistic dividends to holders of preference chares and ( 2 ) they are not investing internally in R&D. Both those are booked against the profit & loss account.
"Taxes are the price we pay for civilization."
-- Oliver Wendell Holmes, Jr.
Actually, the whole Apple/Microsoft thing looks like deflecting attention away from Google's practices. Their tax dodging has been discussed since 2010. Maybe it's even Google themselves who started this bullshit spreading about other companies cos they got too much heat for it and wanted to be all "don't blame us! look these guys do it too! that makes it ok!"
The world has a total GDP on currency converted basis of about 70 trillion dollars, australia has a GDP of about 1.4 trillion. 1/40th of 70 trillion dollars would be 1.7 trillion. And not all of the people in the world even have internet access to matter to google.
(source: wikipedia http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal) which gives couple of different estimates that are all pretty close given our margin of error here).
Nobody said there was something illegal going on. It is a legal practice. However, it is really shady practice that Google is purposely doing. They know it, we know it, everyone knows it. Legally speaking they can continue doing it if they so choose. However, it is still morally wrong.
What kind of fool of a company would Google be if it DIDN'T exploit every tool the government gives it to minimize it's tax burden? Furthermore, how irresponsible to it's share holders if it didn't utilize the law to achieve the highest rate of return.
Google is not the villain here. No company is, when it's simply exercising the controls given to it by the government under which it operates.
Mod me down with all of your hatred and your journey towards the dark side will be complete!
They are calling it a translation error and that in fact the company motto is "Do Evil". Apparently "Don't" doesn't translate well from corporate BS to plain speak.
It goes by many names. Tax avoision, tax optimisation, tax efficiency. Google does it, Microsoft does it, Apple does it... even the optician I use has a token headquarters in the tax haven of Gurnsey. Every major company engages in the practice, and they'd be stupid not to. Making a profit is the reason for their existance.
Slashdot - News for Accountants, Taxation that matters
Comment removed based on user account deletion
Maybe we should all say that copyright laws only apply if you pay taxes in that country? That will make them think twice about going to tax havens with no legal system that will endorse their claims of piracy, trademark or copyright violation.
I was promised a flying car. Where is my flying car?
I think people here don't seem to understand the Australian tax system.
It is entirely designed to take money from productive individuals and hand it over to corporates, while cutting in the politicians who facilitate this. Then the government proceeds to hand over a few crumbs to the unwashed masses (a.k.a. taxpayers) from the sell-off of natural resources, while avoiding at all cost to invest anything in infrastructure.
In such context, Google's contribution of $74,000 (which is less than half of the income taxes I pay as an individual Australian resident per year at the marginal rate of 48% for my income from hard work and lots of overtime) can be seen as a generous token, because most corporations seem to pay bugger all and just pocket obscene subsidies instead.
If the US were capable of prosecuting large companies for financial fraud, there'd be a jail full of executives from every major financial firm. Instead, the worst of the criminals got multiple rounds of bail out money and other "stimulus" that lined their pockets. You can't expect legal action against large companies to happen as long as they're allowed to pay off our elected officials to look the other way.
I think people here don't seem to understand the Australian tax system.
As an accountant, it's clear to me that people generally, but especially technology websites, do not understand any tax system. In the case of the latter I'm fairly sure it's wilful ignorance since there's a habit of neatly avoiding very obvious things that require mere common-sense to trigger realisation that they're spouting bullshit.
It's equivalent to those media articles on hacking, with the picture of some hooded terrorist stealingz your megahurtz. There is activity to be concerned about, but anyone with the slightest bit of knowledge -- or simply combining common-sense and critical thought -- can just glance at it and find themselves shaking their head as they hold it in their hands, unable and frankly unwilling to decide on which is worse: that the media is so intentionally misleading or genuinely so incompetent.
Revenue is not the same thing as profit.
Impose tax on idle cash.
Casteism