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Google boss defends UK tax record to BBC

Thursday, 25 April 2013   (0 Comments)
Posted by: Author: BBC News
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Source: BBC News

Google's executive chairman, Eric Schmidt, has defended his company paying just £6m in UK corporation tax.

His comments came after a committee of MPs last year denounced multinationals - including Google - who pay little tax on their UK earnings, as "immoral".

In an interview to be broadcast on The World at One on BBC Radio 4, Mr Schmidt said his firm invested heavily in the UK and its services boost the economy.

He conceded that "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," he said.

"And we're a key part of the electronic commerce expansion of Britain, which is driving a lot of economic growth for the country."

He added that Google's behaviour reflected the way all big international companies manage their taxes.

"The same is true for British firms operating in the US, for example," he said.

"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."

Chancellor George Osborne, along with leaders in France and Germany, have called for international action to tackle so-called "profit shifting" by multinational companies to avoid taxes.

North Korean trip

Mr Schmidt also spoke about his well publicised trip to North Korea in January, saying his aim had been to plant a "seed" in the minds of government officials that letting the internet into the reclusive state would be necessary to having a "proper country."

"North Korea is by far the most isolated country on earth," he said.

"There's essentially no internet access. There are roughly a million mobile phones, but they don't even have the basic capability of browsing.

"So the average North Korean person is completely cut off from any of the kinds of conversations or knowledge that's going on globally. It's by far the worst such [country]."

But Mr Schmidt could not gauge the North Koreans' response.

"One of the characteristics of the North Koreans is that you can't tell what they're going to do because they don't actually acknowledge what you say," said Mr Schmidt.

He said officials listened to his speech, but that "they don't really answer you".

"The fact of the matter is the North Korean government is particularly good at PR about themselves. And if you look at the PR and essentially the spin and the stuff they say, it's bizarre."



Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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