Google exec grilled over tax

Marion Dakers
GOOGLE’S head of northern Europe tried to downplay claims the internet giant is avoiding tax in Britain yesterday, telling MPs the firm is “very clear about how we operate”.

The public accounts committee hit out at vice-president for sales and operations Matt Brittin for being based in the UK while maintaining that the heart of Google’s European operations is in Dublin to take advantage of the lower rate of corporation tax in Ireland. Committee head Margaret Hodge said a whistleblower had alleged that UK-based staff were instead at the core of Google’s operations, closing deals with clients and designing adverts.

Hodge said: “You are a company that says you do no evil, and I think that you do do evil in that you use smoke and mirrors to avoid paying tax,” adding that the company engaged in “devious, calculated and, in my view, unethical behaviour”.

Brittin, repeating an argument he made when appearing in front of MPs in November, said: “We hire people with sales skills, but no-one in the UK can execute a transaction – no money changes hands.

“The rights to what we sell are owned by Google Ireland. Trades have not been completed with Google UK at any point.”

Brittin said the company fully complies with UK tax law. John Dixon, head of tax policy at Ernst & Young, declined to comment on Google’s tax liability when questioned by the committee.

But some tax experts criticised the way that MPs have dealt with tax policy, saying the UK’s complex tax system is equally opaque.

“Parliamentarians repeatedly call on businesses to be truthful, transparent and accurate in reporting their tax policy. Parliamentarians would do well to ensure that the way in which they address tax issues also bears these hallmarks,” said George Bull, senior tax partner at Baker Tilly.