The news for the last few weeks has been increasingly dominated by the corporate taxes paid (or, to be more precise,‘not paid’) by the large global companies operating in the UK market. Many of those cited – Amazon, Google, Facebook even Capgemini – have been in (or around) our own tech sector.
I don’t think I have seen any report that has suggested that any of these companies has broken the law. But the word ‘immoral’ seems to be used in every article. People like Matt Brittin from Google would want us to believe that it is the duty of any company to pay the minimum taxes. Indeed, he says, it is an obligation on behalf of shareholders to do so. Brittin would put the blame for the situation squarely with the politicians/HMGovt.
I’m not so sure I agree. I have been most ‘moved’ in recent times by the number of UK tech people who openly acknowledge the huge debt they owe this country. Whether this is for the education they themselves received all the way through to the service provided by the NHS to their families. In many cases they could have moved ‘offshore’ to avoid UK taxes but chose not to do so.
I myself have been presented with many schemes to reduce my own tax bill. All of them legal but most feeling ‘immoral’ – like flipping houses to avoid CGT on our holiday home.
We should also remember that Google, Amazon and their like do not create ‘new’ revenues. All of their revenue is a substitute for ‘legacy’ revenues which tended to be earned by UK HQed (and therefore UK taxed) companies. Google has taken huge revenues away from ads in local papers operating in the UK. Amazon from High Street booksellers, record shops and electrical outlets.
I hope that HMGovt tightens the tax rules for global companies. I hope that the G8 introduces new ‘global’ rules to make taxes on these companies fairer. But, at the end of the day, the Googles and Amazons have to understand that they have a moral responsibility to the UK which provides so much of their revenues (and profits).
I understand that the public outcry has already forced Starbucks to ‘rethink’. Although boycotting their awful coffee is a lot easier than boycotting Google or Amazon!