Internet Giant Google’s dominance is known the world over. However, not many know how efficiently Google manages to evade taxes and get tax benefits from governments in various countries. The internet company has been accused of avoiding tax in excess of 200 million Pounds in UK. There has been a hue and cry about how Google has been avoiding paying taxes on huge in UK. Accounts of the company reveal the UK operations have raked in excess of 2.6 billion, officially based in Ireland.
The powerful internet company admitted it paid only 6 million pounds during 2011 to the Exchenquer. Experts and tax analysts point out that the amount paid is 218 million short of what should have been paid. Although Google’s UK arm announced that it had a turnover of 395 million in 2011, Google Inc. the parent company in California, revealed that its UK division had a turnover of $4 billion ( 2.6 billion Pounds) during the year. Richard Murphy, Tax Accountant of Google offered an insight on why the company does not have to pay enormous amounts on taxes in UK.
Interestingly, Google has registered its UK division as a service business, which in turn allows the company to deflate its actual sales figures. This procedure is carried out by channeling UK operations. Revenues generated are channelized as a service to Ireland, where corporation tax is extremely low. It’s not the first time Google’s tax contribution has come under the scanner, and it certainly won’t be the last. This internet giant has the uncanny knack of accomplishing what it aims to achieve, well, in mysterious ways.