Google earns 47 BILLION but pays just 70million tax in seven years

the culture of deference

http://www.independent.ie/business/irish/google-pays-just-014-tax-in-seven-years-3319796.html



While people reel in the aftermath of another austerity budget, entirely legal accounting magic allowed the multibillion-earning multinational to pay fractional tax to the Irish Exchequer.




On turnover of €47.44bn, Google Ireland paid total tax of €69.91m between 2005 and 2011.





If any Irish couple used the same tax evasion policies they would only pay €126 euro tax a year on combined earnings of €90,000.



Google keeps tax bills low through a system of transfer pricing – royalty payments filtered through Ireland, the Netherlands and ultimately Bermuda.
"Ireland has the laxest transfer pricing rules of anywhere in Europe because of the objective of employment there,"



"Ireland doesn't ask questions of companies that are located there,"


"Politicians of all parties in Ireland have nailed their colours to the low tax-rate mast, so Ireland is unable to take to task large corporations that are taking it for a ride.'."




Ireland may not want to tackle a global giant that employs 2,500 people here, but France has reportedly slapped Google with a €1.68bn tax bill and has raided its Paris offices several times.



Parent company Google Inc paid a worldwide tax of just €2.5bn on €26.4bn in profits in 2011.




Google Ireland said: "We make a big contribution to the Irish economy by employing around 2,500 people in our European HQ in Dublin, helping hundreds of thousands of businesses to grow online and we've invested €75m in our recently opened data centre and another €226.9m in the acquisition of three office buildings in Dublin in 2011 alone.

jeepers101

Lets face it they wouldn't be here providing jobs if not for the tax system. Same goes for a multitude of multi-nationals.

Strawberry Fields

If that's what they paid, I'm glad we got it over the US or UK.

AnarchistKen

It's just good business sense. Build a bridge

CrazyRabbit

If they had to pay more tax, they would move to a country that was cheaper to operate in. And then we'd have 2500 more unemployed people claiming the dole/medical card etc instead of paying taxes.

AnonoBoy

If only people didn't keep putting up great websites on tav avoidance then google wouldn't be able to do this.

It's like they can find any website there is or something.

Celly Smunt

I don't care,they're keeping food on peoples plates.

kodoherty93

They employee 2,500 workers who are paid excellent wages who the pay income tax, prsi.

Then those individuals rent properties (income tax on landlords), they also pay vat on everything they buy. They support jobs indirectly in shops when they buy and google supports jobs indirectly buying from suppliers. Meaning the employees pay millions every year indirectly and directly.

If it wasnt for google in Dublin 2 who would rent in that horrible area.

What's your point we tax google more. It isn't a loyal Irish run firm if it doesn't like a tax system in a country it will leave and take its 2,500 employees elsewhere

Where To

Yeah, let's bully the evil multinational with no ties to Ireland yet employ lots of people in Ireland into a position where it would be more economically viable for it to move somewhere else.

I wish you were Minister of Finance OP.

squod

You're hearing about this only now?

the culture of deference wrote: »

Google Ireland said: "We make a big contribution to the Irish Polish , Italian, Spanish, Dutch etc.....economy by employing around 2,500 people in our European HQ in Dublin,

more likely.

Fr_Dougal

the culture of deference wrote: »

bla bla bla anti-google rant bla bla bla

Turned down for a job with Google were we?

Piliger

the culture of deference wrote: »

On turnover of €47.44bn, paid total tax of €69.91m between 2005 and 2011.

If any Irish couple used the same tax evasion policies they would only pay €126 euro tax a year on combined earnings of €90,000.

Companies do not pay tax based on their Turnover - where on earth do you get that crazy notion ?

Google employ lots of people here, people who pay lots of PAYE/PRSI and Google pay huge amounts of PRSI on top of that - as well as the supporting jobs that their presence created and maintains.

Thankfully we maintain a low Corporation Tax system in this country and that attracts companies like Google to come here.

ScumLord

pmcmahon wrote: »

I don't care,they're keeping food on peoples plates.

and porn in their bookmarks.

Big multinationals have to act like this. As long as they can jump around the planet looking for the best deal there's no way any individual country can do anything about it. It would take a global agreement which won't happen. Even beyond the wages they pay out there must be advantages to having a company like google based here. They're at the top of their game and ex google employees have gone on to create some of the next best technology companies out there. Just getting Irish people working in the google environment is going to have benefits for Ireland.

Skid

the culture of deference wrote: »

On turnover of €47.44bn ...

Big difference between Turnover and Profit.

I don't care anyway, Google could move somewhere else tomorrow if we hit them with a Corporation Tax Bill. Better to have them here giving employment than somewhere else.

Chips Lovell

Piliger wrote: »

Companies do not pay tax based on their Turnover

Yeah, but it doesn't make for as good a headline.

Skylinehead

Google as a whole brings in about $40 billion a year. So I doubt those figures for Ireland alone, most likely makey-uppy.

squod

ScumLord wrote: »

As long as they can jump around the planet looking for the best deal there's no way any individual country can do anything about it.

Doesn't bother England. Why would it bother us? Everyone has to pay tax. Having an effective corporation tax of 2% or something is an outrage.

They should pay-up or fuhk-off.

UKuncut

AnonoBoy

The French are on to them about work they say they should be paying tax on over in Paris.

http://www.irishtimes.com/newspaper/frontpage/2012/1102/1224326036937.html

AnonoBoy

squod wrote: »

Doesn't bother England.

England's not as f*cked as we are economically though.

oppenheimer1

Even if a global mechanism could be devised to make large multinationals pay more tax, it wouldn't be implemented. That is simply because it would cause a stock market crash.

Grayson

is there a single company, anywhere, that pays more tax than nessecary? Do any of them ever think, "We've found a way to pay more tax, let's do it?" For that matter, does anybody do that? I can't imagine any protesters volunteering to bump themselves into a 60% tax bracket.

I don't get the whole outrage about google/amazom/starbucks paying little tax. If you want a company to pay more tax, tax them more. Don't complain about the company not doing it.

squod

all of that money is stuck overseas, and can’t be brought into the United States without paying a 35% repatriation tax. This leads to some silly outcomes. For example, Google, overall, is worth well over $150 billion and is sitting on as much as $40 billion in cash.

the culture of deference

Skid wrote: »

Big difference between Turnover and Profit.

I don't care anyway, Google could move somewhere else tomorrow if we hit them with a Corporation Tax Bill. Better to have them here giving employment than somewhere else.

Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.


“Double Irish” and the “Dutch Sandwich” -- helped reduce its overseas tax rate to 2.4 percent using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.





They take advantage of Irish tax law to legally shuttle profits into and out of subsidiaries there, largely escaping the country’s 12.5 percent income tax.




The earnings wind up in island havens that levy no corporate income taxes at all. Companies that use the Double Irish arrangement avoid taxes at home and abroad.




Google now has a stock market value of $194.2 billion.




Income shifting commonly begins when companies like Google sell or license the foreign rights to intellectual property developed in the U.S. to a subsidiary in a low-tax country.




Dublin Office


That licensee in turn owns Google Ireland Limited, which employs almost 2,000 people in a silvery glass office building in central Dublin, a block from the city’s Grand Canal. The Dublin subsidiary sells advertising globally and was credited by Google with 88 percent of its $12.5 billion in non-U.S. sales in 2009.



Allocating the revenue to Ireland helps Google avoid income taxes in the U.S., where most of its technology was developed. The arrangement also reduces the company’s liabilities in relatively high-tax European countries where many of its customers are located.



The profits don’t stay with the Dublin subsidiary, which reported pretax income of less than 1 percent of sales in 2008, according to Irish records. That’s largely because it paid $5.4 billion in royalties to Google Ireland Holdings, which has its “effective centre of management” in Bermuda, according to company filings.





We completely lose approx 15% of 5.4 billion in tax revenue every year from this.




To steer clear of an Irish withholding tax, payments from Google’s Dublin unit don’t go directly to Bermuda. A brief detour to the Netherlands avoids that liability, because Irish tax law exempts certain royalties to companies in other EU- member nations.



The fees first go to a Dutch unit, Google Netherlands Holdings B.V., which pays out about 99.8 percent of what it collects to the Bermuda entity, company filings show.


The Amsterdam-based subsidiary lists no employees.

brandon_flowers

godeas16 wrote: »

If that's what they paid, I'm glad we got it over the US or UK.

This.

Without Google, Facebook, LinkedIn, Ebay etc Ireland would be minus 100,000 jobs. The jobs situation is bad enough without bad mouthing one of the main employer types in Dublin.

The Irish Independent is some ball of **** too!

uberalles

You can see how it's next to impossible for a local coffee shop to survive near a tax dodging star bucks.

pontia

is this similar to what u2 does ?

ScumLord

squod wrote: »

Doesn't bother England. Why would it bother us? Everyone has to pay tax. Having an effective corporation tax of 2% or something is an outrage.

They should pay-up or fuhk-off.

UKuncut

They would **** off, every company on the planet does everything it can to save money. Countries like England, France and Germany have fairly healthy local economies, they don't need Google like we do.

Google as a company are shaping the future, if they're doing some of that shaping from Ireland we're at an advantage.

We can either have google here paying little tax or have them somewhere else paying us no tax. It's not like they're a company that costs us much either, they're not polluting or causing problems they're a company that depends on big thinkers, they take in and produce intelligent people. If anything the government should be taking better advantage of having a company like google down the road. letting them role out new technology here and putting Ireland on the bleeding edge of technology.

uberalles

Let's all boycott google and go with an irish version

Www.doras.ie


Doras Ireland Your Doorway to the Internet

Doras is the Irish for Door and we plan to be your doorway to the internet in Ireland. We will give you information on the best websites in Ireland and abroad.

Grayson

uberalles wrote: »

You can see how it's next to impossible for a local coffee shop to survive near a tax dodging star bucks.

How is that impossible because Starbucks pay less tax. That's less tax on money that leaves the country. Not on money that's staying in or money used for wages. So it's money the local starbucks is not keeping.

Whereas the local coffee shop pays more taxes on profits, but the profits stay here.

Shane732

Awwhhhh you've not concept of how the tax system works!

The effective 2% Corporation Tax rate Google and other MNC are paying is completely irrelevant. The number of jobs/sales the MNC have routed through Ireland isn't.

If we increased our tax rate or closed off some of the perceived loopholes not only would we loss most of the multinational jobs we currently have, we'd also be in contravention of EU law and it would also create mayhem for any Irish SME that trades outside Ireland.

If our CT rate was 40% I think you'd find that Google wouldn't have much of a profit sitting in their Irish companies.

Goodshape

pontia wrote: »

is this similar to what u2 does ?

Yes but they're Irish, and should therefore know their place and get back down here with the rest of us.

Google and Amazon and those lads are from the USA. Like Coca-Cola and McDonalds and Britney Spears. We NEED them. And they're so cool.

squod

ScumLord wrote: »

They would **** off, every company on the planet does everything it can to save money. Countries like England, France and Germany have fairly healthy local economies, they don't need Google like we do.

This just annoys the schite out of me. Shure walk all over us, be grand. People will even admire them for their' Haughey like attitude. As long as they're doing ''some'' good, they can do what they like. Sickening TBH.

ScumLord

squod wrote: »

This just annoys the schite out of me. Shure walk all over us, be grand. People will even admire them for their' Haughey like attitude. As long as they're doing ''some'' good, they can do what they like. Sickening TBH.

It's not that they're walking all over us, we lured them here with our tax laws. The only reason they're here is because we created an environment to attract them. Job done. We can't really complain.

pontia

at least google employ people,what does u2 do ? same clowns preach to rest of us we should be giving to charity,hipocrites and parasites

Goodshape

pontia wrote: »

at least google employ people,what does u2 do ? same clowns preach to rest of us we should be giving to charity,hipocrites and parasites

I know rite?! Feckin eejits thinking they can use the fame they've earned (not that they deserve it!) to raise awareness of good causes. Thinks he's George Clooney or someone important like that! GET BACK TO DUBLIN YA GOB****ES!! amirite?!?


For serious though, I appreciate the arguments for "keeping Google et al. in the country", but I suspect we give away a little too much to attract the big shiny names, and I'd love to see a breakdown of the quality of those jobs created and the number of Irish people filling them, vs. non-nationals.

pontia

Goodshape wrote: »

I know rite?! Feckin eejits thinking they can use the fame they've earned (not that they deserve it!) to raise awareness of good causes. Thinks he's George Clooney or someone important like that! GET BACK TO DUBLIN YA GOB****ES!! amirite?!?


For serious though, I appreciate the arguments for "keeping Google et al. in the country", but I suspect we give away a little too much to attract the big shiny names, and I'd love to see a breakdown of the quality of those jobs created and the number of Irish people filling them, vs. non-nationals.

irelands in the ****ter,u2 pays no tax here but tells us the big bad west should help africa out,u never hear charity begins at home

KyussBishop

Ireland is essentially leeching tax returns from other countries, in being a tax haven, so it's only a matter of time before we get a smack, in the form of a forced corporation-tax increase, and/or international efforts at cracking down on tax avoidance.

We should be making the best use of it as we can, and providing the right infrastructural/living/business environment to hold on to the multinationals, when we inevitably lose our advantage in the future, but we have been greedy and have already squandered the opportunity to use the corporate tax income in that way, because we now have landed ourselves in an economic crisis, and need to use the money to manage that instead.

We will most probably lose our corporate tax advantage, before getting the opportunity to setup the right environment, to hold on to these multinationals.

ScumLord

Goodshape wrote: »

For serious though, I appreciate the arguments for "keeping Google et al. in the country", but I suspect we give away a little too much to attract the big shiny names, and I'd love to see a breakdown of the quality of those jobs created and the number of Irish people filling them, vs. non-nationals.

Even if they did bring in a lot of non-nationals those outsiders would be spending their money here in Ireland. Those outsiders would also more than likely be at genius levels, if they live and breed in Ireland that's a good thing.

I don't see what having Google here would cost us? It's not like we're loosing out on anything, it doesn't cost us anything having them here so anything we make out of them is a bonus. Google is full of rich, smart people. It generates so many more opportunities having them here.

Fr_Dougal

the culture of deference wrote: »

Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.


“Double Irish” and the “Dutch Sandwich” -- helped reduce its overseas tax rate to 2.4 percent using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.





They take advantage of Irish tax law to legally shuttle profits into and out of subsidiaries there, largely escaping the country’s 12.5 percent income tax.




The earnings wind up in island havens that levy no corporate income taxes at all. Companies that use the Double Irish arrangement avoid taxes at home and abroad.




Google now has a stock market value of $194.2 billion.




Income shifting commonly begins when companies like Google sell or license the foreign rights to intellectual property developed in the U.S. to a subsidiary in a low-tax country.




Dublin Office


That licensee in turn owns Google Ireland Limited, which employs almost 2,000 people in a silvery glass office building in central Dublin, a block from the city’s Grand Canal. The Dublin subsidiary sells advertising globally and was credited by Google with 88 percent of its $12.5 billion in non-U.S. sales in 2009.



Allocating the revenue to Ireland helps Google avoid income taxes in the U.S., where most of its technology was developed. The arrangement also reduces the company’s liabilities in relatively high-tax European countries where many of its customers are located.



The profits don’t stay with the Dublin subsidiary, which reported pretax income of less than 1 percent of sales in 2008, according to Irish records. That’s largely because it paid $5.4 billion in royalties to Google Ireland Holdings, which has its “effective centre of management” in Bermuda, according to company filings.





We completely lose approx 15% of 5.4 billion in tax revenue every year from this.




To steer clear of an Irish withholding tax, payments from Google’s Dublin unit don’t go directly to Bermuda. A brief detour to the Netherlands avoids that liability, because Irish tax law exempts certain royalties to companies in other EU- member nations.



The fees first go to a Dutch unit, Google Netherlands Holdings B.V., which pays out about 99.8 percent of what it collects to the Bermuda entity, company filings show.


The Amsterdam-based subsidiary lists no employees.

Yeah, thought as much.

squod

ScumLord wrote: »

It's not that they're walking all over us, we lured them here with our tax laws. The only reason they're here is because we created an environment to attract them. Job done. We can't really complain.

Oh come on! We attracted them with 12.5%, not bluddy 2%. They're avoiding/evading/dodging tax. Pay up. End of.

Turnover and corporation tax should NEVER been mentioned in the same sentence.

Furious_George

squod wrote: »

Oh come on! We attracted them with 12.5%, not bluddy 2%. They're avoiding/evading/dodging tax. Pay up. End of.

well using that logic they should just keep their operations in the U.S. and stop avoiding tax there by streaming their income through Ireland in the first place.

There are even more benefits to having Google here than the direct jobs to people they hire, importing smart entrepreneurial people, etc. They also provide work to local firms that supply with goods and services thereby creating even more jobs and taxes.

The only downside is that if they eventually decide to close up shop here and move elsewhere they leave a larger trail of destruction than the 200 odd people they employ directly.

For Forks Sake

squod wrote: »

Oh come on! We attracted them with 12.5%, not bluddy 2%. They're avoiding/evading/dodging tax. Pay up. End of.

As has been stated, tax is paid on profit, not turnover. And to further compound how misleading that Sindo article is, the turnover figure quoted is for a 6 year period.

juan.kerr

AnonoBoy wrote: »

If only people didn't keep putting up great websites on tav avoidance then google wouldn't be able to do this.

It's like they can find any website there is or something.

They must Bing or something like it.

squod

For Forks Sake wrote: »

As has been stated, tax is paid on profit, not turnover. And to further compound how misleading that Sindo article is, the turnover figure quoted is for a 6 year period.

*Profit* is defined by their accountants. Buying debt (or whatever) to repatriate cash into the states at a lower rate of interest will effect how their profit looks.

They make loads of money, they're worth loads of money and they want to avoid/dodge as much tax as is humanly possible. That's wrong. There's no two ways about it.

The government in England is having a total shitstorm over this subject. We should be taking a similar approach.

http://seekingalpha.com/article/270434-why-google-is-selling-bonds

http://nowiknow.com/double-irish/

Overheal

the culture of deference wrote: »

Google Ireland said: "We make a big contribution to the Irish economy by employing around 2,500 people in our European HQ in Dublin, helping hundreds of thousands of businesses to grow online and we've invested €75m in our recently opened data centre and another €226.9m in the acquisition of three office buildings in Dublin in 2011 alone.

Unfortunately they make a damn good point. The money they generate for Ireland isn't only measurable by their tax loopholes. The money they invest goes back in some way into the economy, and the employees they hire pay tax as well. Google provides the irish economy with things the government can't, much in the same way a private airline can run better than a public one; in their case this is a data center run by Google that helps keep Irish-based web services fast and responsive. As another example you could point to having Intel and Dell in the country in the same manner; between the two tech companies the availability of PCs in Ireland has exploded dramatically in the last 10 years. You can't always measure the benefit these companies offer through how much tax they pay.

the culture of deference

This is what google thinks of paying its fair share




ERIC SCHMIDT, the head of the internet giant Google has defiantly defended his company’s tax avoidance strategy claiming he was "proud" of the steps it had taken to cut its tax bill which were just "capitalism".


http://www.independent.ie/business/european/im-very-proud-of-our-tax-avoidance-scheme-its-called-capitalism-reveals-google-boss-3325290.html





In an interview in New York Eric Schmidt, Google’s Chairman, confirmed the company had no intention of paying more to the UK exchequer. Documents filed last month show that Google generated around £2.5 billion (€3bn) in UK sales last year but paid just £6m (€7.5m) in corporation tax.




The Californian based search giant has also been revealed to have sheltered nearly $10bn (€12bn) of its revenues in Bermuda allowing it to avoid some $2bn in worldwide income taxes in 2011.

Death and Taxes

the culture of deference wrote: »

http://www.independent.ie/business/irish/google-pays-just-014-tax-in-seven-years-3319796.html



While people reel in the aftermath of another austerity budget, entirely legal accounting magic allowed the multibillion-earning multinational to pay fractional tax to the Irish Exchequer.




On turnover of €47.44bn, Google Ireland paid total tax of €69.91m between 2005 and 2011.
Incorrect that is the amount of Corporation tax they paid, they also paid vast sums in PRSI and other taxes.





If any Irish couple used the same tax evasion policies they would only pay €126 euro tax a year on combined earnings of €90,000.

Tax evasion is a criminal offence, they engaged in wholly legal tax avoidence, very serious and defamatory claim to be making!


Google keeps tax bills low through a system of transfer pricing – royalty payments filtered through Ireland, the Netherlands and ultimately Bermuda.
"Ireland has the laxest transfer pricing rules of anywhere in Europe because of the objective of employment there,"



"Ireland doesn't ask questions of companies that are located there,"


"Politicians of all parties in Ireland have nailed their colours to the low tax-rate mast, so Ireland is unable to take to task large corporations that are taking it for a ride.'."




Ireland may not want to tackle a global giant that employs 2,500 people here, but France has reportedly slapped Google with a €1.68bn tax bill and has raided its Paris offices several times.



Parent company Google Inc paid a worldwide tax of just €2.5bn on €26.4bn in profits in 2011.




Google Ireland said: "We make a big contribution to the Irish economy by employing around 2,500 people in our European HQ in Dublin, helping hundreds of thousands of businesses to grow online and we've invested €75m in our recently opened data centre and another €226.9m in the acquisition of three office buildings in Dublin in 2011 alone.

A few correct facts would be nice!

Wompa1

This whole post and story is misleading. How much do they 'earn' through their Irish operations? Shouldn't that determine the tax they pay?

Also since when is 70 million labelled as JUST 70 million??

ScumLord

squod wrote: »

They make loads of money, they're worth loads of money and they want to avoid/dodge as much tax as is humanly possible. That's wrong. There's no two ways about it.

No, as "the culture of deference" post so eloquently put it. That's capitalism. Avoiding cost is just a big a part of being a multinational as selling is.

I doubt it's just Google doing this, any company that can do this is probably doing the same thing. It wouldn't surprise me if we looked a little deeper into the owners of the independent that we'd find them at it too.

squod

ScumLord wrote: »

No, as "the culture of deference" post so eloquently put it. That's capitalism. Avoiding cost is just a big a part of being a multinational as selling is.

I doubt it's just Google doing this, any company that can do this is probably doing the same thing. It wouldn't surprise me if we looked a little deeper into the owners of the independent that we'd find them at it too.

I'd imagine there's loads at it. We are Ireland is a tax haven for many peoples ''companies'' (personal fortunes) also.

You'll find a lot of the pro house hold tax types defending actions like these for various silly reasons. Let's remember these companies make shed loads of money and can well afford to pay their taxes.