EU says prepared to probe UK Google tax deal
The EU's competition commissioner said Thursday she was prepared to investigate Google's tax deal with Britain as the US Internet giant insisted it complied with all taxation laws.
London: The EU's competition commissioner said Thursday she was prepared to investigate Google's tax deal with Britain as the US Internet giant insisted it complied with all taxation laws.
Margrethe Vestager said so-called sweetheart deals with the tax authorities were "unfair" and sometimes "illegal", as a storm continued to swirl in Britain over Google's deal.
Google announced Friday it was to pay 130 million pounds(USD 185 million, 170 million euros) in back taxes following a probe into its tax arrangements.
"We should be in a union where everyone has a fair chance," Vestager told BBC radio.
The European Union's competition executive said it was too early to say whether Google's arrangement amounted to a sweetheart deal.
However, "if we find there is something to be concerned about, if someone writes to us and says this is maybe not as it should be, then we will take a look", she said.
The opposition Scottish National Party's economy spokesman Stewart Hosie said they had sent a letter calling for such a probe.
Google defended itself Thursday, saying it met its tax law obligations.
Peter Barron, Google's communications vice-president, said the company paid the standard 20 percent corporation tax on the profits generated by its activities in Britain.
"After a six-year audit we are paying the full amount of tax that Her Majesty's Revenue and Customs (HMRC) agrees we should pay, including 130 million pounds in additional back tax,"
Barron said, in a letter to the Financial Times newspaper.
"Governments make tax law, the tax authorities independently enforce the law, and Google complies with the law."
Google executives and HMRC officials are due to be grilled by parliament's public accounts scrutiny committee over the deal, on February 11.
On Wednesday, more than 30 OECD countries signed an agreement to share information about multinationals in a push to boost transparency and combat corporate tax avoidance.
Prime Minister David Cameron was forced to defend the tax deal in parliament on Wednesday and disputed claims that Google's effective tax rate was three percent.