21/05/2013 13:39 BST | Updated 21/07/2013 06:12 BST

Google Is the Last Company I'd Begrudge for Avoiding Taxes


The last kind of person suitable to carry out the role of Chair of the Public Accounts Committee would be a 'yes man' - or as might currently be the case, a 'yes woman'. Margaret Hodge's inquisitive, demanding style is therefore to be welcomed; but her recent comments that Google's tax arrangements are akin to 'evil' - a response to the company's informal motto 'Don't do evil' - have raised more than a few searching questions.

One audience member on last week's Question Time clearly agreed with the Labour MP for Barking. "They're taking so much from society", he claimed, "but they're giving very little back". Let us ask then, what has Google ever done for us? Well, what about providing a search engine used by billions that really does put an endless stream of knowledge at one's fingertips? A map service that allows people to scale the world up and down, in and out, in closest detail? A blog publisher which allows people to share their thoughts with anyone interested, and a video host on which 72 hours of video content is uploaded every single minute?

There has rarely been such a liberalising force in the discovery of knowledge than Google Search, or a tool to encourage writing and self-journalism than Blogger. Google Maps has done more than any school atlas to inform the casual-inquisitor of their spatial surroundings, and YouTube has widened choice available in entertainment content to such an extent that it threatens to undermine one of the greatest inventions of the 20th century: television.

In a world where £40 a month mobile phone contracts are increasingly common, surely for the use of Google's services we must have to stomach a similar cost? Well, not exactly. In fact, not at all. In my memory I have transferred nothing of monetary value to Google what so ever. Diddly-squat. My greatest contribution allowing its advertisers the presence of a few pixels on my computer screen, which occasionally I may have clicked. "How dare they have so many adverts on YouTube!" some cry on the comment threads. Sure, the face of Justin Bieber next to your favourite music video may be off-putting, but is this not a better alternative than having wait hours on end for it to come on MTV, like we once would have done? Without wanting to sound like a missionary from the Google PR department, the cost-benefit analysis looks fairly good.

Owen Jones argues that, for Google to pay around 2% in corporation tax, is a 'scandal' which symbolises the "arrogance" of tax avoiders "being drunk on three decades of free market triumphalism". Indeed, fashion has dictated that free market capitalism - and the idea that its scientific advances can make us all more prosperous - has taken a fair beating of late. Whether we can keep up with rising populations and dwindling resources is certainly food for thought. But nonetheless, in Google, Liberalism can boast a significant success story.

Short of saying that 'pick-and-mix' tax arrangements make a mockery of the law (much of this activity is legal), no company should decide how much tax it pays depending on how 'cool' its brand is or how useful it thinks its products are. The issue is a difficult one for a Prime Minister who constantly has to fend off accusations of being 'out of touch'; no wonder David Cameron allowed Google CEO Eric Schmidt the chance to sneak out via the back door on his visit to Number 10 yesterday.

In an ideal world, Google should be paying more in tax, but don't hold your breath when international agreement is the only state-based solution. Instead, public pressure is the strongest force to persuade companies that it is in their interests to make a 'moral' contribution in tax. Fundamentally this is a free market cure; people, rather than the state, are the ultimate moral arbiters. When Starbucks realised that customers could quite easily take their custom to a nearby Costa they swiftly made changes to their tax arrangements. By no means is this ideal; Google's monopoly is so strong that competition in their field is even less forthcoming.

But since when have we lived in an ideal world? We might have to take the rough with the smooth on this one; however 'evil' we portray these mighty transnational corporations let's not forget how often they are a cause for good. Small businesses that religiously obey their tax obligations no doubt benefit us too - that, the uneven playing field, is the true injustice - but don't expect me to be protesting outside Google's Victoria headquarters anytime soon.