In a recent article by Ars Technica entitled After moving money around, Google paid tiny amount in European taxes
Basically the company created a shells company in Ireland to be its “European headquarters” and then set up a series of other shell company around the world – notably in Bermuda – and then charges its subsiduaries for its services and claims it all back. Officially it is "technical legal", but of course morally reprehensible. But what do billionaires care about morals, especially where money is concerned. (that’s rhetorical).
So, last year, on $22.8 billion in sales (of $60 million worldwide) they used exploits to claim all but $37.2 million back. Sounds a lot but it’s a paltry 0.16% of profits – when really they should be paying 40% or so. The report, taken itself from one in the Irish Times (Google pays €27.7m tax at Irish subsidiary on €17bn revenue only goes to raise awareness in my eyes of seemingly unstoppable power of these vast companies, often with turnovers rivaling that of many country GDP.
Amazing how much richer the rich can get by using tax loopholes – and how convenient that despite being widely known and widely and shamelessly exploited by big multi-nationals they are never closed, so the carousel goes on. The understanding is the big companies have a duty to their shareholders (and mostly themselves, of course) to use such tactics. You’d think – worldwide – that governments would have a duty to their electing citizens to stop this – but voters don’t directly line their pockets with back-handers, jollies and a myriad of other incentives to amend – or not amend – the laws to line their own equally greedy and self-serving pockets.
Google’s effective tax rate in the United States has fallen dramatically from 21 percent to 15.7 percent in recent years as the company has broadened its use of overseas tax benefits.
Perhaps when they perfect the art in their ‘home’ HQ in The United States (or elsewhere for other corporations) and all of a sudden the president has to tell congress and the nation how the one mighty country is officially bankrupt – because Google, once paying 21% on its billions in earnings, dropped them to 15%, to 1.5%, to 0.15% – and all the others, like Starbucks, like Apple, like Amazon, followed suit.
How can this have happened, they will lament – as civil wars break out because of the state of the economy. How can this happen? No, how can it not…