Google Agrees To Pay 130M UK Pounds (~ $185M) In Back Taxes (telegraph.co.uk) 87
whoever57 writes: Google UK has come to an agreement with HMRC (Her Majesty's Revenue and Customs) under which it will recognize a larger share of its UK sales in the UK, instead of funnelling them through the Republic of Ireland. In addition, Google will pay 130M UK Pounds in back taxes representing tax on sales since 2005.
And obviously, Ireland will rebate on the taxes... (Score:2)
And obviously, Ireland will rebate on the taxes... since the income is being realized in the UK instead of Ireland, retroactively.
Right?
Right?
Re: And obviously, Ireland will rebate on the tax (Score:2)
Really? Won't Apple's tax bill in Ireland more than cover this when the EU get dos with them?
Re:And obviously, Ireland will rebate on the taxes (Score:5, Insightful)
Well the phrasing "come to an agreement" says it all..
For any normal person you don't come to an agreement with the government, they state how much tax you owe and you have to pay it or you go to jail, there's no negotiation.
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This. It's quite clear that this is a gentleman's agreement and not based on any taxation laws otherwise the headline would be very very different.
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Years ago, when I was opening a new office and picking the location, I actually had various municipalities approach me and offer me various subsidies, abatements for taxes that would be due, and things of that nature. My company was nowhere near the size of Google. At that time, I employed fewer than 150 people. So, I can only imagine what goes on behind closed doors. When we opened our third office, down in Georgia, I was getting calls from various folks as soon as they heard I was looking for large office
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Yeah some of this stuff isn't even based on agreements, it's based on the discrepancy between countries taxing where companies are based and countries taxing where companies are incorporated. The good old Double Irish loophole. Fortunately the loophole has been closed as of 2015. Unfortunately that's only for newcomers to the scheme, existing corporations are given grace until 2020, I'm sure that will be long enough for high paid lawyers to figure out the best place to move the company so the tax bill remai
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>For any normal person you don't come to an agreement with the government, they state how much tax you owe and you have to pay it or you go to jail, there's no negotiation.
That's not actually true. The IRS will sometimes negotiate with you: https://www.irs.gov/Individual... [irs.gov]
In the case of Google, the settlement amount is so small, I suspect the UK knew it would lose in court, since Google has been very clever with its tax strategies.
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"Someone has to make the final decision."
And that "someone" in any civilized country is a justice court.
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For any normal person, the tax law is incredibly simple. The larger you get, the more complicated the laws get.
If you are employed, you pay your taxes via the PAYE system, your employer handles all your tax issues at source.
If you have earnings from other sources, you fill out a 6 page form and send your outstanding tax to a HMRC bank account.
By the time you reach a few million in revenue a year, you need the additional issue of audited accounts. More paperwork, more issues.
Larger multinational companies ha
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This highlights what a farce those defending long running tax evasion (yes evasion) schemes by large US companies is have been peddling. All along we've heard "But it's legal, they're doing nothing wrong!".
I've long been making the point that we don't know if it's legal or not, and that's never been fully established.
Between the amount of settlements now beginning to come through and the various investigations by European wide and European national institutions into tax deals it's beginning to become pretty
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Considering I am forced to hand over my money to a private company whether I want to or not which only makes some wealthy people even more wealthy, it appears it's not just Republicans who are stealing money from the people.
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Can they afford it? (Score:2, Funny)
Google will pay 130M UK Pounds in back taxes representing tax on sales since 2005.
Isn't UK worried about bankrupting Google into going out of business?
The agreement, which comes after a six-year HMRC investigation
Is it at all possible that they spent more than 130M worth investigating this?
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They're either not doing a particularly good job of evading taxes, or they're doing a really good job of evading taxes.
Most likely, they are doing this because if realized income on auctions for AdWords counts as a payment negotiation taking place in the UK when the auction goes to a winner for a particular AdWords auction, even though such things as bid amount and so on are automated "negotiations".
If I were cynical, I'd say they were making agreements like this in order to act as a market barrier to entry for competitors: pay a small enough amount that it doesn't hurt Google, but a large enough amount that matching it wou
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They can afford to build a billion quid campus in King's Cross. 130MM doesn't sound like they're paying enough taxes to me.
http://uk.businessinsider.com/... [businessinsider.com]
Re: Can they afford it? (Score:2, Insightful)
Google took $66 billion in revenue last year alone. 9% of that was from the UK. Given that their net is reported as about 10% of that (which may also be "creatively" reported), thats 660M profit last year alone from the UK. This is meant to be 11 years back taxes, so this seems far too low. Sounds like nothing more than a face saving token gesture in an attempt to keep the proles from grumbling about US corporations leeching money out of the UK, while at the same time allowing them to continue with nothing
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I am taking your statements at face value and as being truthful. I do, technically, own shares in Google and can look at their financial filings but I am taking you at your word. Now, I have a few dollars. My account was actually one of the "lead" accountants for my State's Revenue Department. That's why I hired her. She's really, really good. I have survived two audits. I do not personally but I do technically do quite a bit to reduce my tax burden - entirely lawful.
That, claiming that a mere 10% is net, o
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Yeah, someone mentioned a billion pound campus being built - and I'm not familiar with UK tax code but that's both an expense and an asset - if they write off the expense and then amortize depreciation on the asset then... Yeah, I could see that whacking a good percentage of their tax burden down to size. I'm had to gain some fluency, over the years, but my taxes are too complicated for me to do on my own and I actually have an accountant who manages my finances for me and takes care of my accounting. It's
UK Pounds? (Score:1)
It's either £ or GBP, take your pick.
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We'll talk when your presidential candidates understand the difference between "race", "religion" and "political idealogy".
America is a 21st Century country still living with social norms made in the 15th Century (police abuse, civil war levels of personal armament, no healthcare service worth mentioning unless you have money, and wanting to bar all "foreigners" because they don't understand the differences between them).
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It's either £ or GBP, take your pick.
Or indeed £. Preview is your friend, slashcode is not.
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I can preview £ all I like it still comes out £. If you have a suggestion as to how to avoid this I'd be keen to hear it.
What's in a statement? (Score:5, Insightful)
Google has come to an agreement.
vs
Google has agreed to a settlement.
vs
Google has been found guilty and are forced...
What is the point of this? It seems very clear that this is some kind of feel good measure, a public gesture of good will. I wonder if this is part of reducing the heat on governments to close the taxation loopholes that allow this kind of activity to be legal in the first place.
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How about google executives responding from their prison cells via their lawyers. Now that is the proper headline for multi-million dollar tax cheats. Keep in mind, mass cheating in taxes, results in austerity, where the poorest pay for the richest cheating by suffering and dying as a result of reduced social services and all those involved know this, their greed is killing people.
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Now that is the proper headline for multi-million dollar tax cheats.
That's my point. There is no tax cheat. Other than Apple in one country all of these bastards are actually obeying the letter (but not the spirit) of the taxation laws. Which is why it's troubling that Google "reached an agreement" rather than "laws were changed and google was forced".
What this means is that nothing has been fixed.
If that were the actual spirit of the tax laws... (Score:3)
Other than Apple in one country all of these bastards are actually obeying the letter (but not the spirit) of the taxation laws.
If that were the actual spirit of the tax laws... the letter would be different.
Because the letter of the law is what it is, one has to expect that the letter is an accurate embodiment of the *actual* "spirit", as opposed to the "spirit" that everyone pays lip service to.
If this were not the case, the people making the laws would have to be pretty critically stupid.
And if that were the case... what does this say about the intelligence of the people who elected them? They don't even have the disadvantage of
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Because the letter of the law is what it is, one has to expect that the letter is an accurate embodiment of the *actual* "spirit", as opposed to the "spirit" that everyone pays lip service to.
Splitting hairs. All laws are defined by what they are enforced to mean.
The "spirit" of the law, last I checked, is generally understood to be the intent of those who wrote/approved the law.
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If that were the actual spirit of the tax laws... the letter would be different.
With GAAR in the UK that's no longer true.
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Because the letter of the law is what it is, one has to expect that the letter is an accurate embodiment of the *actual* "spirit", as opposed to the "spirit" that everyone pays lip service to.
No, it's pretty obvious that isn't the case. Most of these loopholes are clearly designed to take advantage of things that the people drafting the law didn't think of. They then become normalized and the people abusing them scream blue murder if anyone tries to fix the holes, claiming that it will destroy their apparently unprofitable and non-viable businesses.
It's obvious how we got to this situation. The tax system is extremely complex and has been added to and patch up endlessly over the years to deal wi
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It's obvious how we got to this situation. The tax system is extremely complex and has been added to and patch up endlessly over the years to deal with specific issues.
Perhaps when the government wants to give money to a special interest, instead of changing the tax code from something simple to something extremely complex, they should leave the tax code simple, and make an explicit grant of funds.
So if you wanted to, say, encourage Twitter to locate its offices in San Francisco, instead of giving them a tax break in law, they'd have to pay exactly the same taxes as everyone else, and then there's have to be a separate "Thank yo for locating in San Francisco" grant to off
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They're not actually fooling anyone, you know. (Score:2)
That's not how politics work. There are simply too many incentives towards complexity and obfuscation, fuzziness and discretion.
They're not actually fooling anyone, you know.
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Because the letter of the law is what it is, one has to expect that the letter is an accurate embodiment of the *actual* "spirit", as opposed to the "spirit" that everyone pays lip service to.
Letters and spirit are in perfect harmony for a local company doing local business. They make sense on an island, they work well in isolation. The problem is that the letter of the law combined with the letters of laws of other nations become incompatible with the spirit.
See it doesn't matter if the entire world changes their laws to agree with the tax havens, or if the tax havens change their laws to agree with the rest of the world. Both are just fine except that the existence of different definitions of
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Re:What's in a statement? (Score:5, Informative)
This is how tax works for large corporations in the UK:
1. Pay accountant to obfuscate your tax liability
2. Take head of HMRC out to an expensive restaurant and have the following conversion:
CFO: How much tax do we owe?
HMRC: I dunno, LOL.
CFO: Our PR department says we need to pay at least a few mill or people might start to overcome their apathy. Alternatively you could spend years taking us to court and we would win anyway, cos our lawyers are top notch. Then we can do it again every single year.
HMRC: A few mill sounds fine. I'm ordering dessert.
CFO: No you aren't.
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Keep in mind, mass cheating in taxes, results in austerity,
That's true, but Google may have been acting in no worse faith than any other corporation. The laws are set up to permit the wealthy and corporations to avoid (not evade) taxes. Sometimes they get them a little wrong, and wind up evading instead of avoiding, but we should really not have systems that permit them to avoid more taxes than the little guy, anyway.
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They are not idiots, they knew exactly what their greed was doing and they were witnessing the outcomes, their response, meh fuck those idiots paying us and paying our taxes, more money for us. Shallow scum supported by corrupt governments, their greed killing people.
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Google hasnt been found guilty of anything, as this isnt the result of a court case or judicial review - they have come to an agreement with HMRC on the basis that tax law is complicated and can be interpreted in many ways. The two parties came to an agreement and a mutual interpretation of the tax laws without having to involve an independent arbitrator (a judge).
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Exactly, so next year they'll pay next to no tax again just like all other corporations do. My point is that this isn't good news. This is paying lipservice to the people who complain that corporations pay too little tax. It's a gift to shut up the critics, nothing more.
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No, in April Google will pay taxes in the UK because the UK changed the law for the start of the 2015/2016 tax year as part of the Finance Bill 2015.
No one should pay more tax than required by law, and until now its been possible to have the law require you to pay no taxes. The UK did the proper thing and changed the law to eliminate loopholes - until they did that, I was fine with Google et al paying no taxes.
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This should be in the summary, not buried several comments deep, modded only to 3. Sorry, I haven't seen /. mod points in years else I'd have put you up to 4.
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Are you certain about the timing? In 2015 tax dodging was a big issue in the G20 summit. Laws were passed, agreements were made, but for the most part there was a long grace period for existing tax dodgers. The loopholes are slowly closing and even Ireland has changed the low to prevent double Irish taxation but as of 2015 that applies to only new companies, it won't be applied to existing companies until 2020, which is also consistent with measures some other countries introduced.
At least it's a step in th
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cheated
Before you can use that word you need to change the tax law. Google is not a charity and their shareholders would not take too kindly to voluntary overpayment of taxes.