EDM of the week: The curious tale of Google’s corporation tax payments

May 16, 2009 at 11:06 am Leave a comment

googleA Labour MP has questioned why internet company Google only paid £600,000 in corporation tax last year.

Austin Mitchell’s Early Day Motion has been backed by two other MPs, Andrew Dismore and Peter Bottomley.

It reads:

“That this House, noting that Google now has more advertising revenue in the UK than ITV, is concerned to find that in 2008 it generated 1.25 billion in revenue in the UK but paid only 600,000 in UK corporation tax because it declared a loss of 4.5 million in its UK operations even though its overall pre-tax profit is 34.2 per cent. of its turnover; furthermore notes that 92 per cent. of Google’s total sales outside the US are accounted for in Ireland though they generated no profit there either, so that the company is legally avoiding 110 million of UK corporation tax in the UK and 135 million of tax in Ireland, which derives no tax benefit from Google because Google Ireland is owned by a Google subsidiary in the even more efficient tax haven of Bermuda; and suggests that, valuable and useful as Google is, it would be appropriate for Google to pay its proper social rent in this country as well as to make the same contribution to production and employment in the UK as the companies from which it is taking so much advertising revenue do.”

Early Day Motions can be put forward by any MP. Almost none of them are actually debated.

MPs use them to draw attention to specific events or campaigns or to express a view on anything from a constituency matter to a football team.

Other EDMs this week include a call for microchipping to be compulsory for all dogs at the point of sale and a complaint that House of Commons catering grade staff are still waiting for their pay settlement from April 2008.

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