Oddly enough, some of the world’s largest corporations are slamming the UK government, saying that they are not charged enough on corporation taxes. Where so many companies look for ways to work around high taxes, it is interesting to note that the Executive Chairman of Google, Eric Schmidt, says that Google would actually be willing to pay more than it does.
He is on record as saying that the UK’s tax laws are ‘weak’ and that because of this, Google is only paying £8m for taxes in Britain even though the company realises profits of more than £6bn in the UK. However, there is always another side to every story, as Schmidt goes on to point out that they indeed only pay what the law requires them to pay.
Schmidt further states that it would be possible to pay more than they do but, in his words, it would mean doing so voluntarily whilst they are now paying only the legal minimum amount required. He explained to the reporter at the Edinburgh Television Festival that it would not be a wise move to explain to shareholders that they were paying more because they felt sorry for the depleted economy in Britain. With so many countries around the globe in dire economic straits, it just wouldn’t make sense.
There has been a great deal of controversy in recent months involving the corporate tax system in the UK. In fact, some of the riots have been prompted because of this tension. Although Google was not the actual target of this unrest, they too have been criticised recently because they have been diverting revenues of around £2bn (UK revenues) through Ireland that has traditionally lower corporate tax rates.
The consensus amongst citizens and citizens’ advocate groups is that the UK’s corporation tax scheme needs a definite overhaul in order to make a more equitable taxing system. Corporations have been sliding by paying the bare minimum whilst consumers are left with no loopholes or corporate manoeuvres to avoid paying proper taxes.