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So, I was right then

But HMRC and Google’s lawyers were unsure whether the diverted profits tax would apply to its UK operations. In the end, they decided it did not. The company also did not have to concede that Google’s Irish business had a “permanent establishment” — a taxable presence — in the UK. After its lengthy audit, HMRC ran its numbers and found Google owed just £130m.

That’s what it owes under the law as it is. No sweetheart deal.

8 thoughts on “So, I was right then”

  1. “Google thought the settlement would dampen the criticism. ”

    For some very smart guys, a very stupid way of thinking.

    With any politics, you have to work out what people want, and then if it’s worth the price. And not just “what they say they want right now”, but what they really want. Hodge the Dodge and her gang of statist motherfuckers want to own Google and Apple, to have all their profits going to the state. Journalists want to be earning more than Googlers are earning. Unless you’re prepared to give into their eventual demands, you will not satisfy them. The only reason you should not bother avoiding tax is where it isn’t worth it, where the accountants and lawyers cost too much.

  2. Given that HMRC reckon to be successful in about 80 % of the cases they take to court, surely the clamour and outrage from Maugham and Co should die down. HMRC did not fancy going to court. Another example of bad legislation. Another chance for the left to demonstrate its stupidity.

  3. Is there any real debate going on about changing tax law so that it is cheaper to just pay tax rather than an army of accountants and lawyers to avoid it?

  4. “Given that HMRC reckon to be successful in about 80 % of the cases they take to court”

    Arguably that might be an indication they aren’t taking enough marginal (let’s say, 60:40) cases to court.

    Although I imagine sometimes a combination of legal ambiguity and a “winning record” is sufficiently intimidating for them to prove useful.

  5. Philip Scott Thomas

    One question I’ve yet to hear an answer to: was the £130 million the amount owed in addition to what Google had already paid or the total amount owed over the ten years? I assume it’s the former.

  6. @ Liberal Yank
    I can still remember (or, at least I can remember remembering) the Schadenfreude in the City when loads of tax consultants were unemployed and looking for jobs in 1980 after Geoffrey Howe cut the top rate of tax from 98% to 60%.
    And the tax paid by higher rate taxpayers actually went up.
    So, No, there isn’t any real debate because there isn’t any argument against it.

  7. People can be irrational about tax, I remember the tax lecturer in college who had real world experience telling us that people would ask for a £50 tax bill to be challenged even though he pointed out he would charge at least £100 just to read it and write a letter

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