Google Pays £6M Tax On £395 Million Turnover, Sparking Fair Tax Debate

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By Oliver Tree | August 8, 2012 10:13 PM EST

Google [NASDAQ: GOOG) will pay the UK government £6 million ($9.3 million) in tax on last year's revenues of £395 million ($617 million), it was reported Wednesday, re-igniting the debate over lax British tax laws.

Reuters
Google has located its European headquarters in Ireland, where corporate taxes are among the EU’s lowest at 12.5 percent.

The amount has once again sparked debate over how much tax large companies are able to avoid by basing their head quarters overseas and in tax havens such as the Bahamas and the Cayman Islands.

Corporation tax, paid on profits, is normally 23 percent.

"We comply with all the tax rules in the UK," a Google spokesperson told ZDNet.

"We make a big contribution to the UK economy by employing over a thousand people, helping hundreds of thousands of businesses to grow online and investing millions supporting new tech businesses in East London."

Last year Google paid £935,000 corporation tax, according to the Telegraph, while in the six years to 2010 the company paid a total of just £8 million.

Google has located its European headquarters in Ireland, where corporate taxes are among the EU's lowest at 12.5 percent.

The company also operates another headquarters in Bermuda which "charges" its Irish office huge administrative fees for the right to operate - thus shrinking, in 2009, profits at its European operations to a mere €45 million euros.

Speaking at the Edinburgh International Television Festival in 2011, Google chairman and founder Eric Schmidt said: "We could pay more [tax], but it would be very hard to say to our shareholders 'we feel very sorry for these British people, so we're going to pay millions of dollars in extra taxes that we're not required to do."

"There are probably laws against that."

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(Photo: Reuters / )
Google has located its European headquarters in Ireland, where corporate taxes are among the EU’s lowest at 12.5 percent.
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