Chairman Schmidt champions tax records of Google

While the battle over the tax records is still being fought, Google Inc.’s executive chairman Eric Schmidt had a say in defending the company’s reputation. He simply came to the rescue as Google Inc. has been recently struggling with increasing attacks on the sum of tax it paid in the UK.

The bigger they are the harder they fall

Google Inc.’s chairman Eric Schmidt has entered the hot debate over the sum of tax the company paid in the United Kingdom. Like other officials of Google Inc, he underlined that the tech giant had never tried to avoid paying corporation tax in the UK which happens to be the company’s second biggest market just behind the US.

On the contrary, Google Inc.’s chairman Eric Schmidt holds an opinion that the company had a positive impact on the British economy in general as the US-based company did indeed invest in the UK, thereby improving the economic conditions. Eric Schmidt and other Google Inc.’s officials are strongly convinced that the company, which is known for its search engine, played a significant role in expanding and strengthening the electronic commerce segment in the UK itself through also job creation and other measures.

All controversies around Google Inc. arose when it turned out that the tech giant, which has its Europe headquarters in Ireland, paid a scandalous rate of UK corporation tax.  Taking into account the fact that the UK market brought as much as $4 billion in sales, not to mention that the Google Inc. recorded approximately £395 million in UK revenue, 2011 tax of £6 million seems to be  nothing at all.

While championing the tax records of Google Inc., chairman Eric Schmidt has called attention to the fact that British companies also behave in similar manner when it comes to operating outside the UK. He has also underlined that the all activities of the company, including its tax records, are consistent with the law.

However, zealous critics of Google Inc.’s tax records in the UK  are strongly convinced that the approach of chairman Eric Schmidt is an attempt of veiling the Google’s UK chief Matt Brittin’s statement on the Britain’s weak importance.  In 2012, Matt Brittin, chief executive officer at Google UK,  reiterated that all company’s actions were consistent with the law in the UK.  Interestingly, Committee chairman Margaret Hodge underscored at the hearing: “We are not accusing you of being illegal, we are accusing you of being immoral.”

Tax avoidance

The fact is that Google Inc. is not the only company which is accused of paying amusingly low taxes.  The upsetting truth about tax avoidance was revealed in 2012 and since then multinational companies, including Starbucks, have been widely criticized by various organizations and institutions, MPs and common people as well.

Therefore some steps have been already taken to solve the problem of tax avoidance in the UK. Chancellor George Osborne even decided to give money to the UK authorities which would be responsible for implementing policies aimed at stopping tax avoidance by multinational companies.  The UK tax law is expected to be changed so that multinational companies will no longer be able to hide their profits in tax havens as these operations act to the detriment of the United Kingdom.

Anna Domanska
Anna Domanska is an Industry Leaders Magazine author possessing wide-range of knowledge for Business News. She is an avid reader and writer of Business and CEO Magazines and a rigorous follower of Business Leaders.

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