UK parliamentary committee says Google tax settlement small

It is reported that the French and Italian tax authorities have ongoing investigations into Google, and that the amount of tax they believe is due is much larger than the £130m settlement agreed with HMRC, said the report. Other Conservative politicians have already declined to endorse this claim.

HMRC, which carried out a six-year investigation into Google, said it was the “full tax due in law”, while the Chancellor hailed the deal as “a major success”.

Its report criticises the lack of “transparency” over the settlement.

Meg Hillier MP, chair of the PAC, said: “Public anger has been palpable ever since this settlement was announced and we still don’t know the full details”.

A tax deal last month between Britain and US Internet giant Google that forced Prime Minister David Cameron on the defensive was “disproportionately small”, a group of British MPs said on Wednesday.

“The Public Accounts Committee is right to point out, as Labour have, that we urgently need to see transparency around the deal that was done as we still have no details so we can not tell if this was fair for taxpayers”. He was attacked early on when he couldn’t name his salary, and called repeatedly for a simplification of global tax rules.

In its report the committee was concerned the taxman “appears to have settled for less” corporation tax from Google than other countries are willing to accept.

Google generated around 24 billion pounds of revenue in Britain between 2005 and 2015 – the period covered by the settlement.

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In its recommendations, the PAC called on HMRC to “lead the way in pressing for changes in worldwide tax rules to prevent aggressive avoidance by multinational companies”.

Google’s controversial tax deal can not be properly assessed by MPs because of secrecy surrounding the negotiations, according to a report by parliament’s public spending watchdog. “But we’re not. We’re paying 20% tax”.

HMRC defended the current penalty regime, adding that a number of measures would tighten existing fines for non-compliance including publication of individual companies’ tax strategies to give greater levels of transparency.

‘We completely understand that there is a real appetite for as much information and insight as possible into how we pursue the tax payable by multinationals.

“We are committed to being as open and transparent as we can within the constraints of our statutory duty of taxpayer confidentiality”.

Google says it reports relatively little profit in the United Kingdom because most of its earnings are derived from intellectual property like computer codes developed overseas, rather than the sales staff, administrators and programmers based in the UK.