PM defends Google's £130m tax deal

Mode captionLabour leader asks question about settlement from ‘Geoff’

David Cameron has champion the deal UK authorities have struck with Google over tax, requiring the Conservatives have done more than any other government.

The PM be sured the Commons the tax “should have been collected under [the last] Elbow-grease government”.

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

But European MPs have described it as a “very bad deal”, and ins said it amounted to a 3% tax rate.

Mr Cameron was challenged during Prime Woman of the cloth’s Questions about the amount of tax id by the US tech giant, which has record billions of pounds of sales in Britain.

‘Crack down’

He said: “We’re talking nearby tax that should have been collected under a Labour sway, raised by a Conservative government.”

He said it was “quite right” that the extent was done independently by HM Revenue and Customs (HMRC), but he was “absolutely clear that no domination has done more than this one to crack down on tax evasion and bellicose tax avoidance”.

But Labour leader Jeremy Corbyn told the Commons the apportion equated to a tax rate of 3%, and questioned why there was “one rule for big multinational visitors, and another for ordinary small businesses and self-employed workers”.

Labour has white b derogated to the National Audit Office asking it to investigate HMRC’s handling of the community, while shadow chancellor John McDonnell has written to the Mr Osborne clamorous details of how it was reached.

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Former Vocation Secretary Vince Cable said Google had “got off very, very lightly”, and the chancellor had “descried a fool of himself” by hailing the deal as a victory.

Meanwhile, French MEP Eva Joly, vice-chairwoman of the Strange European rliamentary Committee on Tax Rulings, said the deal showed the UK was pre ring “to fit a kind of tax haven to attract multinationals”.

She said MEPs would shout George Osborne to appear before them, and criticised the attempt to “make amends move aside publicity out of it” by talking about large-sounding figures which she said were a fraction of what should be slip someone something a distributed.

Why has Google proved so politically taxing?

By political pressman Ross Hawkins

First, George Osborne risked sounding far too import when he hailed the deal as a “victory” and a “major success”. Administration spokesmen were reluctant to repeat his verdict.

Second, Labour retorted quickly and managed to get a hearing. Their message sounded louder than their internal argy-bargies, for a change.

Third, voters care. The perception that international firms get a change ones mind deal than ordinary people is toxic.

It is HMRC that summon ups tax, not ministers, and the government says it has acted and got results where Labour did not.

But few representatives ever caught the mood of a nation declaring themselves happy with a big organization’s tax return.

Conservative MP Mark Garnier, a member of the Treasury select board, said the agreement represented a “relatively small” amount of money be in a classed with Google’s UK profits.

News Corporation chairman Rupert Murdoch tweeted to say he supposed the com ny was only ying “token amounts for PR [public relations] plans”.


Reports in Wednesday’s Times news per advance Italy is poised to strike a deal for Google to y £113m in back tributes to the Italian government, equating to a 15% tax rate. It is not known how many years such a stock might cover.

‘Complex tax structures’

Google agreed to y the back burdens after an “open audit” of its accounts by the UK tax authorities and a six-year inquiry by HMRC.

Without thought the UK being one of Google’s biggest markets, it id £20.4m in taxes in 2013. The value of its tradings in Britain that year was £3.8bn. Google makes most of its UK profits as a consequence online advertising in the UK.

The com ny has been criticised for its legal but complex intercontinental tax structures. Its European headquarters are in Ireland, which has a lower corporation tax be worthy of than the UK, and it has also used com ny structures in Bermuda.

The BBC’s economics copy editor Kamal Ahmed said it was now likely that focus would change position to other large multinational com nies’ tax arrangements – including Facebook, which answer for only £4,000 in tax in the UK last year.

A new “diverted profits tax” introduced by the supervision, which aims to make international firms y tax for operating in the UK, would see Google and others y multifarious tax in the future, he added.

Head of Google Europe Matt Brittin affirmed last week: “We were applying the rules as they were and that was then and now we are customary to be applying the new rules, which means we will be ying more tax.”

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