
Google was at the center of the scandal in the UK,
writes TechCrunch. The company is accused of tax frauds: ostensibly its London office was selling advertising and, accordingly, had to pay taxes in Britain, while Google claims that the Dublin office was involved in advertising transactions. In Ireland, the income tax is almost half as much as in Britain.
Unfortunately for Google, Barney Jones, who worked for the company from 2004 to 2006, suddenly appeared. He stated that he owns evidence that the London office is still engaged in sales of advertising, and is ready to transfer 100,000 letters and documents to the Tax and Customs Service of Her Majesty.
Jones was asked to comment on the testimony of Google’s vice president Matt Brittin, given to them by the State Budget Committee last week. Brittin said that Google employees in London had never entered into promotional deals, although they had some sales activities. Earlier, in November 2012, Brittin stated that no one in the London office was, in principle, engaged in sales.
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Many global companies place their European headquarters in Ireland, since the income tax there is 12.5% (in Britain - 23). So do Apple with Facebook, and Google is no exception. However, according to Jones, he has evidence that Google UK sold ads to companies like Amazon, Lloyds TSB, Argos, British Airways and Sony.
Google has so far replied that it cannot comment on documents that it has not seen, especially since these questions concern matters a decade old. Google stressed that none of the charges can change the fact that Google pays income tax on its activities in the UK and fully complies with British law.
However, Google is not the only one who has problems in the UK. Amazon may be next, as Reuters recently discovered evidence that it also makes a lot of sales through the London branch, despite the fact that on paper they are processed through a tax-exempt branch in Luxembourg.