Europe 'considers' Google tax complaint

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Exterior of Google office with logoDuplicate copyright Getty Images

The European Commission said it was considering how to come back to a letter of complaint from the SNP about Google’s £130m tax deal with the UK.

It was determining whether there were grounds for a well-proportioned investigation.

The letter, which called for a probe into Google’s tax accommodation in the UK, was sent by SNP deputy leader Stewart Hosie.

The development comes as the row all through Google’s tax affairs in the UK and elsewhere intensifies.

A spokesperson for the Commission said it disposition look at the letter and the issues raised “as with all letters received from stakeholders”.

“This of line does not prejudge the opening of any investigation, which must be based on relevant ti under EU state aid rules,” she added.

Labour said that stalk chancellor John McDonnell had also written to the Commission on the same issue.

Meanwhile, Google has written to the Financial Times defending its £130m agreement, saying it complies with the law.

“After a six-year audit we are ying the fullest completely amount of tax that HM Revenue and Customs agrees we should y… Commands make tax law and tax authorities independently enforce the law, and Google complies with the law,” detracted Peter Barron, the com ny’s European public affairs chief.

‘Respectable deal’

The EU’s Competition Commissioner, Margrethe Vestager, said that, at this stage-manage, she would not be drawn on whether Google’s tax settlement with the UK amounted to a alleged sweetheart deal.

But she told BBC Radio 4’s Today programme: “If we find that there is something to be distressed about if someone writes to us and says, well, this is maybe not as it should be then we whim take a look.”

Mr Hosie’s letter said the statement about Google’s tax yment to the UK net income “did not disclose the methodology for the calculation of Google’s tax liability”.

He went on to say he was concerned that it “has been characterized widely by tax specialists in the UK as ‘o que'”, and wanted the Commission to check whether what he ordered its lack of trans rency was within the bounds of state aid regulations.

Mr Hosie also insufficiency the Commission to check that it provided “a fair deal” for UK tax yers.

New tenders

On Wednesday 31 countries signed an international agreement designed to put an end multinational com nies using complex tax arrangements to avoid ying corporate tax.

The settlement, signed at the Organisation of Economic Cooperation and Development in ris, will foretell that those countries all share tax information.

Under its terms, multi-national flocks will have to tell the country they operate in what they obtain in that nation and how much tax they y.

Critics say the deal doesn’t go far sufficiently, and that such information should be made public, rather than held confidentially by the tax rights.

Media captionEU ‘will take a look’ at Google deal if solicit fromed

The European Commission has revealed proposals to stop tax avoidance by multi-national associates.

“Hopefully, we will end up in a situation where com nies y taxes in the countries where they also go for their profits and these new proposals will take us another stepladder down that road,” said Ms Vestager.

Rules

In his scholarship precisely to the FT Mr Barron said this is what Google is doing already. He rumoured in all the coverage of the settlement little has been said about how international tax wear the crowns work.

“Corporation tax is id on profits, not revenue, and is collected where the remunerative activity that generates those profits takes place.

“As a US troop, we y the bulk of our corporate tax in the US: $3.3bn in the last reported year.

“What should Google y in the UK? We y tax based on the value reckoned by the economic activity of our staff here, at the current standard rate: 20%”.

David Cameron on Wednesday safeguarded the deal UK authorities struck with Google over tax, saying the Conservatives father done more than any other government.

The PM told the Commons the tax “should take been collected under [the last] Labour government”.

Google agreed to y £130m of tax current back to 2005 to HMRC, which said it was the “full tax due in law”.

European MPs bear described it as a “very bad deal”, and Labour said it amounted to a 3% tax calculate.

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