Week 4: Villain – Google

by Jackie_South on January 25, 2016

Google_VillainThis week, Google earn our regular award for villainy

Quite often when I write a post, I’ll Google to check my facts. The fact that I’ve used ‘Google’ as a verb there shows just how ubiquitous the search engine is. And when I typed in the words “Google tax” Google helpfully gave some potential additional words to add to the search, the first being “avoidance”. (Go on, try it).

When even Google itself thinks “avoidance” is the most natural third word to go with “Google” and “tax”, you know that we have a problem.

Her Majesty’s Revenue and Customs, though, obviously don’t use Google. They seem to think that if Google paid £130m to settle its tax liabilities over the last decade, a rate that experts put at just 2.77%. “What?”, HMRC say, “they are fiddling us? Surely not?”

George Osborne, of course, thinks this is a good deal too. Somehow, he manages to argue both that the economy is growing and that his cuts to corporation tax leads to reduced avoidance without noticing that the corporate tax base continues to shrink. You cannot lower corporation tax low enough to prevent some big businesses deciding that it should still fiddle the books to avoid paying up.

Google’s deal is as cynical as it comes: they have made a cold commercial calculation on how little they can get away with paying whilst successfully deflecting criticism for it, and the figure they have come up with is £130m.

They probably had a clever algorithm to come up with the sum.

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