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British MP to Google: “We’re not accusing you of being illegal we’re accusing you of being immoral.”
While the American commentariat (including FDL, guilty as charged) were obsessively sniffing the Petraeus panty drawer, the British tabloids were in high dudgeon over the appearance of “immoral tax evaders” Google, Amazon and Starbucks before Parliament’s Public Accounts Select Committee.
According to Charles Arthur, Technology Editor of the Guardian, “Select Committees are the best fun you ever get in Parliament. And sometimes they’re brutal.”
Arthur compared Committee Chair Margaret Hodge and the other MPs to “wizards who are zapping the Muggles appearing in front of them.”
Full video of the committee’s proceedings here. The Financial Times liveblogged it here.
British MP’s grilled Google’s Matt Brittin over reports that Google had paid just £6m in UK corporation tax on UK revenues of £395m in 2011.
Also on the hot seat for tax evasion were Andrew Cecil, Amazon Director of Public Policy, who was blasted by MPs for failing to answer questions.
Troy Alstead, Starbucks Global Chief Financial Officer, was left scrambling to explain how Starbucks had filed losses each of the 13 years it has been in business in the UK.
“You’re either running the business badly, or there’s some fiddle going on,” said MP Austin Mitchell.
Google’s Britten evoked the strongest ire, however, when he denigrated the work being done for the company by UK workers, and said it could be outsourced:
MPs lashed back that Google was running a “tax avoidance scheme” rather than adopting a business model where they made a real profit:
Political economist Richard J. Murphy said “now we have Google admitting it stacks cash in Bermuda and does not actually pay the US for services it supplies.”
One MP called Google a “giant executive share bonus generation scheme — not an exercise in creating shareholder value.”
Google operates its European business out of Ireland because of the favorable corporate tax rates. Recently French tax authorities wholloped Google with a $1.3 billion tax bill for money funneled between France and Google’s Irish holding company for the past four years.
There seems to be a trend of cash-strapped countries forced to chose between highly unpopular austerity measures or collecting a fair share of taxes from large multinational corporations doing business in their territories, and choosing the latter. Sadly, the US does not appear to be one of them. Many “grand bargain” proposals allow US orporations to evade paying taxes on foreign earnings when they bring profits back to the US.
21 Comments
Instead of lashing out at them, why don’t they just change the law? I guess it is the same everywhere. Politicians just love to give speeches. If the law allows certain things, the accountants will take advantage of the loopholes. Is that anything to wonder about? Just rewrite the law, and lets finish with the circus.
Wow! They structure their business to minimize taxes. In other news the sun came up in the east.
And in other news, Peaches Geldof is preggers again.
I heard on the radio that $tarbuck$ claimed it had never made a profit in the 15 year$ it$ been in bu$ine$$ in the UK.
Well, why shouldn’t $tarbuck$ say that? I’m sure they get away with here in the USA. Why shouldn’t the cousins be ripped off as well?
Will the UK actual put some muscle behind this??
Or will it just be like us chumps here in the USA sniffing around Gen Petraeus’ panty drawer?? Lotsa fun gossiping & rumor-mongering, but at the end of the day: DE NADA happens, at least in terms of any real consequences (yeah: even Betrayus “retiring” really isn’t that big of a consequence for all his sins and crimes, let’s face it).
I don’t know who that is, and I’m kind of proud of that.
What is really need it an Alternative Minimum Tax on the gross receipts of corporations!
I’m sure as the Sun rises in the east the tax haven is working well for Ireland.
Capitalism = secular greed. Capitalism + 10% = fascism.
Somehow, these tax avoiders don’t raise the same ire the 47% do.
When I point that out to conservative acquaintances, they always say some variation of, yes but Obamaphones!
Could explain why Wal Mart is not doing well sales wise and Tiffany’s and Neiman-Marcus are doing very well right now. Concentrating wealth in a small amount of people is not good for the world economy let alone a single country. Multi-National Greed and Avarice will kill us all if we let it.
I’m waiting for the Select Committee on Gambling at Rick’s, that should be revealing.
I had to look it up. But I felt obligated to before I put up the graphic, just in case someone asked.
Oh, you just don’t know the satisfaction I take in WalMart becoming the victim of WalMart. Who among us, years ago, did not ask, if they ship our jobs to China, who’s going to buy their stuff? All that sweet talk that Clinton/Rubin sold us about how NAFTA would work out ok was a con, and they knew it at the time. The jug-eared little crazy guy from Texas called it right.
With regards to the Tiffany’s phenomenon, it’s called hour-glass marketing.
http://www.moneyweb.co.za/…/hourglass-marketing-its-not-what-you-thin...
People honestly don’t know who the Geldofs are?
Pink Floyd’s The Wall? Live Aid? Anyone?
That’s Bob. Who is Peaches? There is a Geldof package deal?
OT, but ‘Peaches’ is also David Petraeus’s nickname. ;o)
oh my
Glad to see some media outlets in the world are currently not obsessed with sex (well, there is Peaches). When it comes to taxes, though, the Brits could certainly get as much criticism as they give.
I’m 80 pages into Nicholas Shaxson’s Treasure Islands, and the British appear to be the the expert and original bad boys of tax evasion from the “City of London” (i.e. the one with 9K residents and 32K companies), Jersey, the Isle of Wright, to Bermuda. Highly recommend this book. Truly shows Leona Helmsly was right that “only the little people pay taxes”.
If you are rich enough, there is a tax haven just waiting for you.
(Back at ya!)
I was out all day, but I’m loving the bytegeist. Thanks, Jane.
The UK is serious about multi-national tax evasion.
The kabuki in front of Parliament is to get the executives on record, and then investigate. When the lies are discovered it is much easier to nail them for lying to parliament than nailing them on tax evasion.
And we know they lied. Why would Starbucks, or any other company, run their businesses in the UK for 15 years, continually expanding, if it were not profitable?