Wednesday, December 12, 2012

Google's tax avoidance is called 'capitalism', says chairman Eric Schmidt

Google chairman Eric Schmidt has insisted that he is "very proud" of the company's tax structure, and said that measures to lower its payments were just "capitalism".

Mr Schmidt's comments risk inflaming the row over the amount of tax multinationals pay, after it emerged that Google funnelled $9.8bn (£6.07bn) of revenues from international subsidiaries into Bermuda last year in order to halve its tax bill.

However, Mr Schmidt defended the company's legitimate tax arrangements. “We pay lots of taxes; we pay them in the legally prescribed ways,” he told Bloomberg. “I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate.”

“It’s called capitalism,” he said. “We are proudly capitalistic. I’m not confused about this.”

In Britain Vince Cable was unimpressed by Mr Schmidt’s views. The Business Secretary told The Daily Telegraph: “It may well be [capitalism] but it’s certainly not the job of governments to accommodate it.”

A Californian pressure group called Consumer Watchdog wrote to the Senate’s Finance Committee demanding a hearing on Google’s “global tax avoidance strategies”.

http://www.telegraph.co.uk/technology/google/9739039/Googles-tax-avoidance-is-called-capitalism-says-chairman-Eric-Schmidt.html