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Australian Govt Pledges Action On Google Tax Evasion
daria42 writes "Looks like Google's habit of funneling billions of dollars in revenue through its Irish and Bermuda subsidiaries continues to attract unfavorable government attention globally. France has already announced plans to take on the search giant's tax evasion habits, and the Australian Government, to which Google paid just $74,000 in tax last year despite having Australian revenues close to $1 billion, has now confirmed plans to do the same."
have they actually been charged with tax evasion?
TFA doesn't mention evasion(not paying the tax you owe and illegal) and it's very different to avoidance which is just using legal means to pay as little tax as you legally can.
Actually, you are wrong. Companies freely admit that they sail as close to the legal wind as possible. Whether they are over the line or not depends on a case coming to court. Avoidance is merely evasion that has not yet been shown to be illegal.
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If so, then loads of prior art. MS, IBM, GE, etc come quickly to mind.
I prefer the "u" in honour as it seems to be missing these days.
Even if that tax is used to provide healthcare, schools, roads and benefits for those on low wages or unable to work? Or does that crazy idea make me a commie?
I want a list of atrocities done in your name - Recoil
If all multi-national companies in the UK paid the tax they are supposed to*...
What you mean by that is that they should not take the deductions that the UK government has written into its tax code. It seems perfectly fair to me for a company to take advantage of every tax deduction it is legally eligible for. Now whether or not those deductions should exist is another question entirely, but the people to hold responsible for that are the members of Parliament who voted for those deductions in the first place (or failed to vote to eliminate them).
The truth is that all men having power ought to be mistrusted. James Madison
I pay 40% tax plus National Insurance. I also used to work freelance and yes, deducted reasonable expenses. I did not claim for stuff that wasn't directly related to my work so no, not really a hypocrite. Being crazy, I tend to think of the wider picture, not just myself.
I want a list of atrocities done in your name - Recoil
Yep, from 40% to about 35%. Not quite the same as reducing it to 0.0007% is it? it's the sheer scale that people object to. Is that so hard to understand?
I want a list of atrocities done in your name - Recoil
Why would you expect a company to pay more than they have to when individuals do not?
Nice try. Google's employees pay tax on their salaries, not Google.
I want a list of atrocities done in your name - Recoil
then change the law.
I'm 100% in favor of making such schemes harder.
what you don't seem to be paying attention to is that most of these are signed off on by the local countries tax authorities.
if one of your friends was a good accountant/lawyer who showed you how you could have cut your tax bill to, say 20% you wouldn't have done it?
it's as immoral as buying your grocery shopping for 1 cent when the supermarket offers to sell it to you for 1 cent and the owner of the supermarket has reviewed your shopping and agreed that he's ok with selling it to you for 1 cent.
him offering you an insanely good deal doens't make you an immoral person.
Just to be clear it isn't only Google that's implicated in this, the summary is probably just a typical attempt at defaming just Google by the usual culprits (i.e. Microsoft shills). That's not to defend Google in this, there's no doubt they're in the wrong, but most well known US multi-nationals are guilty of the exact same thing - some even more so. In the UK the companies exposed for this have included Amazon, Apple, Starbucks, and many others.
There's a practical difference (at least that's how it's defined in Switzerland - which is one of the possible tax avoidance place, although far less attractive than the ones in the summary).
- One is *lying*, giving false information and not paying the taxes you're required by law to pay. You pretend you don't have money and try to hide it (in order not to pay taxes. But according to the law you should be paying taxes). This is illegal. A person or a company doing so should be persecuted.
- The other is just shifting money around. You're absolutely honest and give any needed information out. You simply move the money to another place, where the tax happen to be lower than the first place. Once there, you openly collaborate with the local tax institution, declare all the money you have and pay all the taxes you're required to pay. It just happens that said taxes are lower than in the country of origin. But nothing is hidden, all money is openly accounted for. No one pretends anything false. This *IS LEGAL*. A person or a company doing so is just cleverly playing the system. WHAT NEEDS TO BE DONE is collaborating with the local government so some tax money is funneled back to the original country.
Ireland, for example, has almost no taxes. There's nothing wrong in the law about storing your money there. There's nothing wrong about paying almost no taxes (as long as you declare everything and don't hide anything). If you're unhappy with this, you should bring to court the company putting their money there. you should instead write to your politician asking that the European Union finally comes up with a solution for EU-level taxes (so money is shared between Ireland and the other countries where the money was prior transfer but were the company isn't paying taxes).
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
At which point economy of scale becomes less of an issue and smaller competitors will see their chances improve.
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"Tax avoidance" doesn't appear to phase General Electric. They're definitely not an "internet company," have physical plants around the globe, and they pay a vanishingly small amount of corporate tax by using the same sort of schemes.
Imagine that....large corporations with armies of lawyers using lobbying to help them skirt tax payments to ultimately benefit their shareholders. And I guess it helps to have friends in high places. Guess who is Barack Obama's "jobs czar?" That's right, Jeff Immelt...CEO of GE. In 2010 GE made a global profit of US$14.2 billion. US$5.1 billion of that was attributable to operations in the US. How much did GE pay in taxes to the US government you ask? Well, zero. They actually had the balls to claim a tax benefit (billed against future earnings) of US$3.2 billion.
I'm all for companies being able to make a profit, but c'mon.
Actually, there's a very sensible approach to this, somewhat started in the UK already. We, as citizens, decide that we dislike this kind of behaviour and we boycott the worst 'offenders'. As an old-skool Brit, I'm a tea drinker anyway, there's nothing that I like in Starbucks and I dislike the appalling value for money too.
There's a genuine problem here in that a) it's their fiduciary duty of corporations to maximise profit at all costs, to hell with social infrastructure, the environment and other minor details so this is one of the results b) in the UK the so-called Tax Code runs to about 10K pages of useless complexity, so there's always a decent sized hole somewhere c) If the holes aren't closed everywhere, there'll usually be a new opportunity or place to do this, it's called fiscal dumping.
Finally some socially aware sharefolder activism would help, in some of these cases, but since shareholders are usually large investment funds and insurance companies, there's no pressure from there either. So consumer boycott and sustained negative commentary is a good start, then profits decrease and shareholders begin to wake up and take a mild interest.
On y va, qui mal y pense!
What you mean by that is that they should not take the deductions that the UK government has written into its tax code. It seems perfectly fair to me for a company to take advantage of every tax deduction it is legally eligible for.
Oh Jeez, not this libertarian bleating again. In most case, these companies are intentionally exploiting loopholes in one or more countries' systems to minimise tax. It's disingenuous to imply that this was by design or the intention (as "eligible for" might suggest).
One might argue that their behaviour is still perfectly legal. However, what you said was that it was "fair", which isn't a legal term, and when they're clearly playing the system and paying minimal tax for the facilities they're using, we can quite reasonably say that it's "unfair".
Now whether or not those deductions should exist is another question entirely, but the people to hold responsible for that are the members of Parliament who voted for those deductions in the first place (or failed to vote to eliminate them).
As stated above, this is as much exploitation of loopholes than use of explicitly-designed "deductions", and while they may be legally entitled to take advantage of them, we're free to call them out on it and paint them in a bad light. If they don't like it or that affects their business, tough shit, they can go fuck themselves.
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But you're rather naive in thinking their is some easy black and white line between ok tac avoidance and wrong tax avoidance. If you had dropped your tax to 30% would that be ok? 25%, 20%, 15%, 10% and why would that be ok but 0.00001% lower would be henious behaviour.
We have tax laws and it is folly to try and replace laws with some fuzzy statement saying "You should pay the tax that we think it is appropriate you pay (decided at our discretion)" which is exactly what you do when you stop using the legality of tax payment as a baseline.
Simplify tax laws, remove loopholes etc by all means but until we do we can't really be shocked if this happens.