Google, Amazon face tax(ing) questions

Comment on this story


IO_scitech google logo0

AP

Google is offering a million-dollar prize for a breakthrough that would make solar or wind generated electricity more enticing for everyday uses.

London - British lawmakers on Monday accused major multinational companies of aggressive tax avoidance, amid calls by the UK government for a global crackdown on firms which seek to evade tax.

In sometimes bitter exchanges at a parliamentary committee hearing, legislators questioned Starbucks, Google and Amazon about the amount they pay to the UK government in taxation.

Lawmakers scoffed as Troy Alstead, Starbucks global chief financial officer, claimed that the fact the coffee giant had reported losses for all but one of the 15 years it has operated in the UK was down to poor performance - and not an attempt minimise its taxes in Britain.

“You have run the business for 15 years and are losing money and you are carrying on investing here. It just doesn't ring true,” said Margaret Hodge, head of parliament's Public Accounts Committee.

Alstead acknowledged to the panel that its taxable profits in the UK are calculated after royalties paid to its European headquarters in the Netherlands have been deducted. He said that Starbucks had a special tax arrangement with the Dutch government covering its headquarters, but declined to give details.

“Respectfully I can assure you there is no tax avoidance here,” Alstead told the panel.

Companies operating in Europe can base themselves in any of the 27 EU nations, allowing them to take advantage of a particular country's low tax rates.

Alstead insisted that Starbucks was not seeking to mislead investors or tax authorities about its performance in Britain.

“We are not at all pleased about our financial performance here. It is fundamentally true everything we are saying and everything we have said historically,” he told the committee.

Last week, Britain and Germany called for the world's largest economies to do more to collaborate to fight tax evasion, particularly in online commerce.

Hodge told witness Andrew Cecil, public policy director at Amazon, that many people in Britain are angered over the low tax rates paid by the retailer.

“Your entire activity is here yet you pay no tax here and that really riles us,” she said. - Sapa-AP

Hungry for more scitech news? Sign up for our daily newsletter


sign up
 
 

Comment Guidelines



  1. Please read our comment guidelines.
  2. Login and register, if you haven’ t already.
  3. Write your comment in the block below and click (Post As)
  4. Has a comment offended you? Hover your mouse over the comment and wait until a small triangle appears on the right-hand side. Click triangle () and select "Flag as inappropriate". Our moderators will take action if need be.

     

Join us on

IOL-Social networks IOL-Social networks IOL-Social networks IOL-Social networks