Over the past one week, Google has been slammed by ministers in UK over fudging of their earnings in order to avoid taxes. According to their report, Google made over £1.6 billion in the past year from advertising in UK. However, the company has not paid any tax at all.
The reason, it is being said is because the company used its status as an international company to transfer holdings from one country to the other in a way to minimize taxes.
In this case, Google transferred its earnings from UK to Ireland. Tax levels for corporations in Ireland are between 10%-25% whereas in the UK, it is between 28%-30%.
While the company has not given any officially reply to the criticisms hailed at it, it will be interesting to see if the UK Government will plan any action in order to prevent a recurrence.[via BNET]