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'Insult to Taxpayers:' UK Shadow Chancellor Slams Google's Tax Avoidance

© REUTERS / Dado Ruvic / People are silhouetted as they pose with laptops in front of a screen projected with a Google logo, in this picture illustration taken in Zenica October 29, 2014.
People are silhouetted as they pose with laptops in front of a screen projected with a Google logo, in this picture illustration taken in Zenica October 29, 2014. - Sputnik International
A number of US tech giants have long been utilizing complex arrangements to minimize their corporate tax bills in the UK and other countries they operate in. Although, in most cases, these arrangements are legal, they have drawn criticism as they are depriving public services and other government spending endeavors of millions of dollars per year.

The Labour Party’s Shadow Chancellor John McDonnell hit out at Google and other tech giants for not paying their fair share of tax.

“This has become a yearly insult to those taxpayers who play by the rules and can’t afford an army of accountants to lower their tax liability. There will be millions of hardworking people in this country who are struggling to make ends meet, and will look at the paltry amounts these big companies like Google are paying and rightly be disgusted,” Labour’s shadow chancellor was quoted as saying by an official party press release.

He made the comments shortly after the company’s annual accounts revealed it paid just £50 million (around US$70.3 billion at the current GBP/USD exchange rate) in annual taxes in the UK despite achieving sales of £5.7 billion (US$8 billion.)

READ MORE: France to Sue Google, Apple Over 'Abusive Trade Practices' — Economy Minister

Shadow Chancellor McDonnell – who also serves as an MP for the Hayes and Harlington constituency – blamed the British government for failing to tackle the situation and promised that his party would tackle tax evasion and avoidance if they entered office.

“The problem goes to the top of this government. The Tories’ failure to clamp down on tax avoidance has meant that large multinational companies are paying what they want, rather than their fair share. The next Labour government will introduce our Tax Transparency and Enforcement Programmed, and truly clamp down on tax avoidance and evasion.”

Last year, Facebook payed less than US$10 million in corporation tax in the UK, despite its turnover from its operations in Britain exceeding US$1 billion. Facebook’s ties to disgraced data firm Cambridge Analytica has further accentuated calls for the company and others to pay more tax in the EU.  

Google’s annual accounts show that the firm employs over 3,000 people as part of its UK operation, and a company spokesman said they are investing in new offices in the country to employ another 7,000 members of staff.

Although these companies employ a sizeable number of people in Britain, who pay income tax on their earnings, many still believe that they should also contribute by paying more corporation tax. 

READ MORE: Sweden Repeals Facebook's Tax Breaks, Slaps Network With Sizeable Bill

Google's tax avoidance has drawn criticism on social media from both politicians and ordinary Brits.


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