Another stunning victory for mega tax abusers. Google paid £120m of back taxes to cover 6 years of profit in the UK, reported today by various sources that adds up to tens of billions. The number is almost irrelevant because such a small settlement will be less than 1% if we are lucky. This completely opaque deal which started 11 years ago and that had taken 6 years to negotiate, and the key word is negotiate, demonstrates once again the weakness of HMRC and the lack of appetite for George Osbourne and Dame Lin Homer for change. If Steve Lewis was CEO of HMRC he would move to empower his corporate tax team by giving them the power to publish the formula which is used to negotiate final settlements.
There should be no sensitivity with an open process that is applied to all, big and small. If you choose to put in a tax return that is so exotic to require complex negotiations then you’ll have to accept that’s done in a transparent way. We need to reward those that have the true intent to pay their way and challenging for those that seek to be tax bullies.
I invite Matt Brittin CEO Google Europe to share the formula if Google have truly changed their tax ways. His performance on the BBC Breakfast aided by a woeful journalist hid behind the defence that tax law has changed and that this settlement simply reflected the fact. The follow up question never came ‘why does it take 6 years to settle a routine tax adjustment?’.
The reality has clearly been that Google with their enormous resources have battled HMRC into submission. Sadly, it appears that HMRC feel this is some sort of victory. HMRC desperately need leadership, resolve and the political support to out these companies – Google, Facebook, Starbucks, Amazon and all the usual suspects. They won’t leave our shores, we are the 6th largest economy in the world and punching way below our weight.
Go to www.change.org and sign the petition for the people’s taxman.