Google's European division used the "double Irish" tax haven loophole to dodge tens of billions in tax there and in the US in 2019, newly-filed accounts reveal.
The Big Tech giant took advantage of the sunset clause on the now-defunct corporate tax scheme to avoid tax on profits of $75.4 billion (€63 billion) in payments in both its home country and Ireland.
US-based parent company Alphabet used interim dividends and other payments to move money out of shell company Google Ireland Holdings, which was incorporated in Ireland but domiciled in Bermuda for tax purposes at the time.
That allowed Alphabet to declare a pre-tax profit in the US for that year of just $13 billion — which was effectively tax-free.
Google Ireland, the main operating company with some 4,000 staff, declared profits of €1.94 billion in 2019 after revenues of €45.7 billion, paying just €263 million in tax.
The so-called "double Irish" fix involved corporations registering their intellectual property (IP) in a company registered in Ireland but controlled from a tax haven such as those dotted around the Caribbean. Royalty payments to the company for that IP are taxed neither in the country where the group is headquartered or in Ireland, only in the tax haven — unless they are re-exported.
Ireland banned the dodge in 2015, but controversially allowed companies already using it a five-year grace period until the end of 2020.
Google insisted it had transferred its IP holding to the US, and that 2019 was the last year it exploited the loophole.
"In December 2019, in line with the OECD's base erosion and profit shifting (BEPS) conclusions and changes to US and Irish tax laws, we simplified our corporate structure and started licensing our IP from the US, not Bermuda," a Google spokeswoman said. "The accounts filed today cover the 2019 financial year, before we made those changes.""Including all annual and one-time income taxes over the past ten years, our global effective tax rate has been over 20 per cent, with more than 80 per cent of that tax due in the US," she claimed.
But in 2018 Google Ireland Holdings paid out dividends of €23 billion after filing a turnover of turnover of just $25.7 billion (€21.5 billion). And accounts state that Google Ireland Holdings only became tax-resident in Ireland on January 1 2021.
European Union member state Ireland's corporate tax rate of 12.5 per cent — just over half the average across the bloc — has made it an attractive base for transnationals' European operations.
Reader Comments
- governments don't operate on the 'that which governs best governs least' principle. (At one point it was called 'limited government'; then again, when I was a child I was called gay and I didn't attack whoever said it. )
- entities like the Fed, or far more commonly, corporations, are allowed to exist in perpetuity. They should be limited to the expected lifespan of their youngest founder.
- the entire concept of nation/states must remain inviolable.
I could go on and on; the points I can make are 100% valid. (I'm as sure as I can be about that - which is 99%.) (I know that sounds like a joke but I mean it, even when I find the joke itself funny as I do about that accidental one.)* I feel as if I wrote it all out, it would/could have no effect whatsoever on this sad trajectory we're 'enjoying.' I sometimes envision myself like the judge in Atlas Shrugged's Galt's Gulch, rewriting the Constitution to empasize FREEDOM OF CONTRACT. (But that's when I'm feeling kinda optimistic. When I'm more 'normal for me' I think 'well, that's WAY better than ending up like the judge in The Stand.' )
I know, I bet ogle will pay me the big $ for it
But no, that ain't me, and I'm drafting other stuff at present.
R.C.
*Did anyone see Animanarchy's HILARIOUS joke? about face diapers? Check it out:
Over 50% of liberal, white women under 30 have a mental health issue. Are we worried yet?
A 2020 Pew Research study reveals that over half of white, liberal women have been diagnosed with a mental health condition at some point. Does this mean there's a correlation between progressive...RC
-
*
"Part 2 of this series on Facebook will explore how the social media platform has grown into a behemoth that is much more extensive than what LifeLog’s program managers had originally envisioned. In concert with military contractors and former heads of DARPA, Facebook has spent the last several years doing two key things: (1) preparing to play a much larger role in surveillance and data mining than it currently does; and (2) advancing the development of a “humanized” AI, a major objective of LifeLog."
So good, in fact, that he's almost certainly shoo-in for the Pulitzer Prize! ( Hell! Maybe even the Nobel Peace Prize! )
RC
Actually, I still think of Whitney as a guy's name whether it ever was or not - my poor brain's example is ...(truly) because of the male who . . . made the cotton gin!
RC
Why nor a Basic-Access Tax ? You want to "Sell" your Product in my Country? You don´t want to be Locked-Out? Fine!!
Pay us or we´ll Firewall your A**