Google Chairman Eric Schmidt Defends UK Tax Bill

Google Defends UK Tax Bill

Google's executive chairman Eric Schmidt has defended the internet giant's tax affairs, saying the firm was playing a key role in the UK's high-tech growth.

The firm paid just £6 million in corporation tax in 2011, but Mr Schmidt said the arrangements "fully comply with the law" and it was acting in the same way as other firms.

The tax arrangements of multinational firms including Google were heavily criticised by MPs in a scathing report earlier this year.

The Public Accounts Committee accused Google, Starbucks and Amazon of "using the letter of tax laws both nationally and internationally to immorally minimise their tax obligations".

Asked about the £6 million tax bill on BBC Radio 4's World at One Schmidt said: "Of course that omits the fact that we also hire more than 2,000 employees and are investing heavily in Britain.

"Britain has been a very good market for us. We empower literally billions of pounds of start-ups through our advertising network and so forth. And we're a key part of the electronic commerce expansion of Britain which is driving a lot of economic growth for the country.

"So from our perspective I think ... you have to look at it in totality. You're describing the way taxes work globally. And the fact of the matter is these are the way taxes are done globally. The same is true for British firms operating in the US, for example.

"I think the most important thing to say about our taxes is that we fully comply with the law and we'll obviously, should the law change, we'll comply with that as well."

Giving evidence before the Public Accounts Committee last year, Matt Brittin, CEO of Google UK, insisted the firm complied with the law in the UK and had not breached its own "Do No Evil" mantra.

But committee chairman Margaret Hodge told him: "We are not accusing you of being illegal, we are accusing you of being immoral."

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