Eric Schmidt has offered a somewhat surprising defence for Google's activities as a response to criticism by European publishers that Google is too dominant a force. Google's executive chairman wrote: "We built Google for users, not websites".
Eric Emerson Schmidt is an American software engineer, businessman, and the Executive Chairman of Google. In 2012, Forbes ranked Schmidt as the 138th-richest person in the world, with an estimated wealth of $7.5 billion. Early in his career, Schmidt co-authored the lex analysis software program for the Unix computer operating system. From 1997 to 2001, he was Chief Executive Officer of Novell. From 2001 to 2011, he served as the CEO of Google. He was born in 1955.
Eric Schmidt has offered a somewhat surprising defence for Google's activities as a response to criticism by European publishers that Google is too dominant a force. Google's executive chairman wrote: "We built Google for users, not websites".
Grosvenor, the property company of Gerald Grosvenor, the sixth Duke of Westminster, is hoping to tempt Oxford Street shoppers from Maccy D’s or KFC with a brand new deli.
It's been debated since at least the days of the Luddites: Does technology create or destroy jobs?
You can have the job, but lose the hat IN 1953 Gardner Heidrick and John Struggles left the management consultancy for which they worked, to found a new company which would focus on recruiting corporate bosses. It was the first of what would become the big five executive-search (or “headhunting”) firms, and has been a leader in the recruitment industry for 60 years. The firm’s placement of Eric Schmidt as the head of the then-upstart Google in 2001 is regarded as a signature success: he stayed in the position for a decade, and still serves as the company’s executive chairman.Today Heidrick & Struggles is, well, struggling. Its revenues fell from $616m in 2008 to $444m last year, and over the past year its profit margin has been 3.4%—piddling by the industry’s standards. In July its boss, Kevin Kelly, stepped down after its board said it was considering “strategic alternatives”, including a sale.Heidrick & Struggles’s strong position in recruiting for financial firms left it vulnerable after the 2007-08 crisis. It compounded its woes by overreacting, cutting staff drastically and failing to pay its best recruiters competitively...
THE epic struggle between two billionaires over the future of Dell has gone to another round. Michael Dell, the ailing computer-maker’s founder and biggest shareholder, has now been forced twice to postpone a vote on his proposal to buy out the firm and take it off the stockmarket, for fear that the deal’s critics, led by Carl Icahn, a veteran shareholder activist, may have enough support to scupper the plan.
Commissioner says antitrust fears have not been allayed.
Google has suffered a surprise slowdown in the UK, with revenues falling for the first time in eight quarters.
SUN Valley is about hashing out big ticket deals and forging ties, but also offers ample opportunities for awkward elbow-rubbing.
China's finance minister has issued a surprisingly downbeat growth forecast for the world's number two economy, saying expansion could drop to 7pc this year.
Google's executive chairman Eric Schmidt has said the company's difficult relationship with Apple is on the mend.
The struggling social games makers said its founder and chief executive, Mark Pincus, will be replaced by Don Mattrick, the head of Microsoft’s Xbox business.
Eric Schmidt, the executive chairman of Google, has stressed that it is up to governments to set clear rules on corporation tax.
Cracking down on global tax avoidance tops the agenda at the two-day G8 summit which kicks off today in Northern Ireland.
Barney Jones says he has no regrets even though speaking out on Google's tax affairs may have damaged his careerA former Google employee turned whistleblower, whose evidence is crucial to a parliamentary report released on Thursday into the search engine's tax affairs, has explained that his decision to speak out was rooted in his Christian beliefs.Barney Jones, a father of four, said he felt compelled by his faith to give evidence to the public accounts committee. He was prompted to do so after reading what appeared to be misleading evidence from a senior Google executive claiming that the company did not sell products in the UK and therefore owed no tax there.Jones, 34, a member of the sales team for the company between 2002 and 2006, said he could think of no material benefits to speaking out, but he would do it again if a company he worked for was involved in an "immoral" tax scheme."I don't think there has been any real benefit to me for standing up. The main benefit is knowing that, as one day we will all be held accountable for our actions – I believe that Jesus will hold us accountable for the good and bad we have done – I will know that I didn't allow something within my power to just slip through. But I stood up and said: 'Well, actually this is a wrong thing, and this is something we have to think about,'" he said.On the eve of the release of the committee's report into Google, which is expected to be highly critical, Jones said his career options had probably been damaged because prospective employers may see him as a troublemaker. But he expressed no regrets for explaining how the company sold products from London, but claimed that it only did so from Ireland, where corporation tax is much lower."If no one had stood up and said: 'I don't think this is the right thing,' we would not be having this particular debate about international taxation and therefore the British taxpayer would not get all of the money needed to build the next generation of hospitals and schools," he said.Jones approached the public accounts committee in May after reading a newspaper account of the evidence from Matt Brittin, Google's vice-president, who told MPs: "Nobody [in the UK] is selling."The dispute over tax revolves around Google's use of its European headquarters in Dublin to minimise its tax bill in Britain. By booking all UK sales through Ireland, it handed HMRC only about £10m in corporation tax over the period 2006-11. It is able to record the revenues in Ireland because the UK company is deemed to drum up new business, with sales staff in Dublin executing all deals.But Jones said he attended meetings where Google's London sales staff closed deals. "I looked at his [Brittin's] story and could not believe what I saw," he said.Jones left the company seven years ago but, like many Google employees, had copied his documents on to a memory stick because he had personal emails and photos among his work files. He has contracts, invoices and correspondence between Google and its customers in Britain, which have been seen by the Guardian.Jones, whose father was a headteacher and whose mother was a social worker, gave his evidence to the committee.Hodge recalled Brittin to give evidence to the committee, and concluded that the company's behaviour was "devious, calculated and, in my view, unethical".Jones has spoken to former colleagues, some of whom still work at Google, and has received a mixed response from them, he said."Many have pointed out to me that by taking a stand on this I haven't made myself massively popular. My employment prospects for the future have been affected. Certainly a lot of companies that have a European HQ in Dublin are unlikely to be top of my list of future potential employers. But that's OK," he said.Despite this, Jones, who lives in south London with his wife and children, said he would encourage others to blow the whistle.Jones said he still thought of his time at Google with great fondness and hoped the company would return to its core values."Google is a great company and it has a great history and heritage of the management being held accountable to staff."I remember some wonderful town-hall-type meetings where Google staff got up and questioned senior management about what the company has done, the direction of the company," he said.He said he hoped Eric Schmidt, Google's executive chairman, would listen to the committee's report. "I think Eric is bound to listen. I'm an ex-employee and quite a low-level one at that – but I know there are lots of other employees who are very concerned about the company doing the right thing by other countries and I am sure Eric will think long and hard about how to address this problem," he said.GoogleTax avoidanceCorporate governanceRajeev Syalguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Many in Silicon Valley fear America may lose its position as the centre of the global technology industry, amid spiraling fears that its titans have become too close to government.
French unemployment has edged up again, piling more pressure on President Hollande as China-France trade tensions simmer and Paris moves to block EU-US trade talks.
For just $25, you can go to space ... sort of. Planetary Resources launched a Kickstarter campaign on Wednesday for "the first publicly accessible space telescope," and backers will be able to use it in a variety of ways.
Google CEO Eric Schmidt says his company should "pay the taxes that are legally required" (Report, 27 May). In that case, Google should pay UK corporation tax on all its operations in the UK. That is what is legally required. It is not legally required for Google to route its income stream through low-tax jurisdictions such as Ireland. Google does indeed have a fiduciary responsibility to its shareholders, but the laws governing this responsibility do not specifically state that companies should seek to avoid tax. That is merely Mr Schmidt's own interpretation of those laws. Avoiding tax is legally possible, but we all know that doing what is legal and doing what is right are not always the same thing. Mr Schmidt needs to make up his mind. Will Google continue to be regarded as a company of high ethical and moral standards, one which does no harm? Or will it become just another profit-maximising multinational? Time to choose.Morgen Witzel Fellow, Centre for Leadership Studies, University of Exeter Business School• As the unpaid volunteer treasurer of a village social club struggling to survive in a difficult economic climate and to provide a valuable amenity for a village community, I was upset to receive from HMRC a letter threatening a possible surcharge because payment of the club's VAT was two days late. In view of the fact that many very rich multinational companies are avoiding some taxes altogether and other companies are able to negotiate cosy settlements of disputed bills, it does make me wonder where HMRC's priorities lie. David RobbieStafford• Dave Hartnett, formerly of HMRC, might have taken his generous public pension and gone to work with Tax Research UK, UK Uncut, or even Christian Aid. His unique expertise would have been welcomed and, I assume, he doesn't want for much materially. Instead he prefers to advise overseas governments on tax "policy" for Deloitte (Report, 28 May). Is enough never enough for some?Nigel GannChiselborough, SomersetTax avoidanceCorporate governanceGoogleEric SchmidtHMRCguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Forget Big Brother. Companies and countries are discovering that algorithms programmed to scour vast quantities of data can be much more powerful. They can predict your next purchase, forecast car thefts and maybe even help cure cancer. But there is a down side.
Paris-based thinktank co-ordinating international tax agreements expected to publish strategy document this weekThe pressure is on OECD secretary-general Angel Gurría to formulate a taxpayers' charter that resolves the current disputes over corporation tax payments.The Paris-based thinktank has accepted various duties over the years, and co-ordinating international tax agreements is one of them.On Wednesday all eyes will be on its HQ near the Eiffel Tower, where it is expected to publish its latest paper on the subject, and, within its wordy shell, present a coherent strategy.Google boss Eric Schmidt claims all he wants is a level playing field. He says his firm must play the system to minimise tax and use every available lever to please its shareholders. Only when the rules clearly stop him will he resist the temptation to end his tax dodging ways.The problem centres on the role royalties play in international company structures. At the moment Google can charge its various subsidiaries a royalty for using its brand and a host of other goodies developed in California. Stopping this legitimate practice is going to be difficult.In the past the OECD has proposed moving away from corporation tax in favour of sales taxes and wealth taxes, which would apply to a good deal of the assets and transactions carried out by corporations such as Google.But whatever scheme is devised will need to win international support. Just a couple of weak links would undermine the entire project. Ireland, for instance, is unapologetic, despite the many recent examples that show US companies fail to even pay the 12.5% corporation tax Dublin charges. Turkey has long given up any pretence of charging foreign companies corporation tax. Even manufacturers can escape as long as they export their goods.For every country that can say it is tough on international businesses, such as Norway, there are 10 that turn a blind eye.OECDCorporate governanceTax avoidanceGlobal economyPhillip Inmanguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Google's executive chairman Eric Schmidt says it is up to governments to reform tax policy not companies.
Violence from Syria creeps back into Iraq
BILL Gates says he supports a debate on corporate tax, as the US steps up scrutiny of the tax practices used by multinationals.
Google's executive chairman has defended the web giant's maligned tax affairs, saying it would pay more if laws were changed, and that he's "rather perplexed by this debate."
In much the same way as Samuel Johnson stated that patriotism is the last refugee of the scoundrel, I think we can safely say fiduciary responsibility is the last refugee of a business leader on the ropes (Change the law and we'd pay more tax, says Google chief, 27 May). With 30 years of experience campaigning against many of the worst aspects of company behaviour, time and time again I have found this to be the last desperate response from those who have lost the argument in the court of public opinion.I daresay abolitionist William Wilberforce was told by those who used slaves in their businesses that they had "a fiduciary responsibility to their shareholders" to make use of what was legally available to them and that they could not just "arbitrarily decide" to stop using slaves while their competitors still did.Moral leadership is now called for. Surely there is one multinational company out there willing to break ranks and do the right thing on tax?Paul BrannenNewcastle upon Tyne• It may be of interest to learn that Google, Starbucks, Amazon and Apple are not the only companies who find that Luxembourg has better fiscal weather than the UK. Here are some recent "country of origin" entries from my credit card statements:First Great Western: LuxembourgWilliam Hill: GibraltarEasyJet: IrelandThe Trainline: LuxembourgThese are, of course, good old British companies. And in the case of First Great Western, and presumably all of the other train operating companies for whom the Trainline does most of the ticketing, they got a UK government grant in 2011-12 of 7.5p per passenger mile. No doubt the managements of these enterprises have perfectly good explanations.Peter Thomas-CruttwellSymonds Yat, Herefordshire• When employees change jobs they expect the Inland Revenue to charge them at a temporary emergency rate until the tax authorities are fully acquainted with their actual earnings.I suggest this method be used for companies like Amazon, which have not provided a convincing account of their UK profits. Thus each £100 sale would have added £20 VAT and £21 corporation tax, simply collected as 41% VAT.Normal companies are allowed running costs against their corporation tax, so I suggest that this allowance be irretrievably forfeited until they provide a convincing account of their UK profits. This forfeiture could help shorten the time needed by their accountants to help them start an honest relationship with the UK. For companies like Google, which are paid per click on an advertisement, the payment should be claimed from the client.David MonkmanHuntingdon, Cambridgeshire• Ed Miliband panders to the right in trying to shame Google (Miliband to tell Google: pay taxes or be cast like a rogue benefit claimant, 22 May). He could have scored a different political point by comparing them to other tax-dodgers such as people who bury their wealth in offshore accounts or MPs who fiddle expenses.Anne StrachanManchester• "I cannot see the point of tax havens. Or rather, I can see the point, but not why we tolerate them," writes Simon Jenkins (22 May). "We" don't tolerate them; "we" are powerless. Tax havens are more than just tolerated by "them", the good folk who profit from their existence: the powerful, and the politicians who hope to attract party donations. I see the future for tax havens and their admirers as rosy.Eddie DougallBury St Edmunds, Suffolk• As a first step towards more concrete action, the party leaders could demand that their MPs (and lords) resign directorships in companies which are either based in tax havens, or are part of groups that make use of tax havens.Anthony HaywardDudley, West Midlands• I avoid Starbucks – don't like the coffee (It's got my name on it – but that doesn't mean they care, 27 May). But if I did, I would give a name so as to hear the barista holler "Taxman".John LaunderWinchester, HampshireTax avoidanceGoogleAmazon.comAppleStarbucksTax and spendingInternetEric SchmidtEd Milibandguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Britain, France and Germany are pushing for the European Union's 27 member nations to share financial intelligence and cooperate on other steps to crack down on corporate tax avoidance.LONDON — European leaders fired a warning shot in the battle against multinational companies that exploit loopholes or set up complicated schemes to minimize their tax bills, calling for collective action to thwart such practices.
Labour – a party that pussyfooted around with avoidance for 13 years – needs to convince the country it will do better next timeIn his own mind, Ed Miliband is pretty clear about how he would like to distinguish the Labour party he leads from the Labour party that went before. He aims to be readier than Blair and Brown to challenge the powerful in general, and the economically mighty in particular.Over three years, we've seen flashes of both halves of that – in, for example, his determination to take Wapping to task over phone hacking, and in his conference speech on predatory capitalism, which initially left pundits scratching their heads, but looked smarter as the months rolled by.What he has not yet succeeded in doing, however, as his personal poll ratings remorselessly demonstrate, is get this mission across to the country at large, still less generate much enthusiasm. Save perhaps for down the Red Lion on Parliament Street, the rhetoric of "responsible capitalism" is not the language of the pub.However worthy specific policy ideas – such as using procurement to encourage training, and overhauling reporting rules for listed firms – it is tough to persuade the experts that these things can achieve anything much from the opposition benches, and tougher to persuade voters to do anything but yawn.The great PR problem with the agenda has been the absence of real-life predators to point to – demons to bring the story to life. A wave of fury over tax avoidance should transform the possibilities; voters who sweat for pay they cannot divert to Luxembourg or Bermuda rage at the antics of the Amazons and Googles who thrive upon their custom.While Nick Clegg and David Cameron are also manoeuvring to make anti-avoidance their own, the coalition is beset by infighting, and Mr Miliband spots an open goal. He struck at it on Wednesday, by adding aggressive words about Google's aggressive tax practices into a long-planned speech at the firm's Big Tent.The pointed naming and shaming of its absent boss soon provoked a response from Eric Schmidt himself, redoubling the handy publicity.The remaining question, however, is whether Labour – a party that pussyfooted around with avoidance for 13 years – can convince the country it will do better next time. That will have to involve hard and specific commitments to act.Mr Miliband is making the right noises, talking up comprehensive country-by-country reporting of corporate finances, and also signalling a willingness to act unilaterally if the PM's vaunted efforts at the G8 do not succeed.Sadly, Ed Balls's policy papers remain overly cautious on the smallprint, replete with talk of "intelligent transparency", which can surely only be something more slippery than transparency plain and simple.The endless questions on a tax return are tiresome, but – Labour take note – in the end the thing to do is declare on every detail.Tax avoidanceCorporate governanceGoogleAmazon.comInternetE-commerceEd Milibandguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
A slip of the tongue by Google's executive chairman speaks volumes about his perception of the company's tax obligationsA week or so ago, Google's chief executive, Larry Page, caused ripples when he suggested at a public event that laws older than 50 years or so shouldn't apply to internet companies, and that it might be fun to have an island where Google could dabble in new ideas without all the silly meddling of governments. (That's only a slight paraphrase.) The only way he could have seemed more like a Bond villain would be if he had been stroking a cat while speaking.While not an island, Google created its own patch of turf in Hertfordshire on Wednesday with its Big Tent event, which really is held in a big tent – a gigantic one with perfect Wi-Fi, and tables, chairs, coffee machines and a big stage in the grounds of the Grove hotel. Think of it as the most glamorous camping imaginable, Google's little island in the UK.Sadly, there were no self-driving cars (buses were laid on), nor people sporting Google Glass . About 250 people turned up for a day out of London to hear deep thinking about the future, whether we'll all turn into robots, and perhaps a bit of fisticuffs about tax.For that, we looked to Eric Schmidt, formerly the company's chief executive but now its executive chairman – in effect, its roving representative on earth. Especially on tax, he is a master at not really answering questions. He's like the un-Google. So he turned up in the afternoon to un-answer lots of questions about tax.For someone so brainy, he has a remarkable capacity not to know things. How much money does Google ship to Bermuda under its complex tax system? He doesn't know. Couldn't Google live by the spirit as well as the letter of the law? He doesn't know enough law. How should international tax law be reformed? He's really not sure. When will Google Now (a Google program that suggests bus journeys and hotel rooms based on your travels) seem as smart as a human being? Well, that's hard to say.If he were a search engine, you'd type your question and get a blank page back. Getting direct answers out of Schmidt would tax a saint – at a low rate, of course.He also has a surprising capacity for going missing at opportune times. Despite having been at the Grove on the Monday and Tuesday for the private Google Zeitgeist, he somehow missed Wednesday morning's session.There, Ed Miliband cruelly (and cleverly) used Google's original "letter from the founders" to argue that its tax structure – "close" sales in Ireland, ship money to the Netherlands, and then ship even more money to Bermuda, where it must form a sort of digital sand dune – was short-term thinking, something that Larry Page and Sergey Brin had said they wouldn't do.Yet when Miliband looked around to say this to Google's man – like the guest at a housewarming who slags off the owner – Schmidt, like Macavity the cat, wasn't there. Not until the afternoon, when he un-answered like a pro.Certainly he must tut and sigh when he hears Page talk about ignoring laws and creating fiefdoms but, when he was asked about capitalism, he replied: "Of course, Google is a capitalist country …" Laughter. "Company," he said, uncomfortably. A slip of the tongue? Perhaps the truth is out. Perhaps Larry Page's island isn't so far off after all. One has to wonder – how soon can one move there, and what will the tax rate be?GoogleTax avoidanceEric SchmidtLarry PageCorporate governanceUnited StatesCharles Arthurguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Eric Schmidt rejects Ed Miliband's criticisms of tax affairs, saying firm fears being 'double or quadruple taxed' under any changesThe Google chairman, Eric Schmidt, has told political leaders to sort out a rational and predictable international tax system, as he faced a wave of criticism over the firm's failure to pay more tax.Ed Miliband attempted to deliver his rebuke direct to Schmidt when invited to speak at the Google Big Tent conference, although the US executive missed the Labour leader's address on Wednesday, saying he had to attend a meeting in London.Nick Clegg disclosed at a press conference he had also criticised Google at a Downing Street meeting earlier in the week at which Schmidt was present. David Cameron's aides, after earlier denying the prime minister rounded on Schmidt at that meeting, later briefed that Google had been implicitly rebuked in the context of the prime minister's general call for greater tax transparency as part of his agenda for the G8 summit next month.Speaking at the annual Big Tent event after Miliband had left, Schmidt said one of his key concerns about changes to the tax structure was that Google might be "doubly or quadruply taxed".Asked by Labour MP Stella Creasy how he would reform the tax system, he suggested: "Have a rational system that's predictable and doesn't change very much."Virtually all the American companies have tax structures like this, and UK companies operating in the US do too. But if we pay more taxes in one area, then we pay less in another."Google feels very, very strongly that tax information, tax policy should be done openly. I don't think companies should decide tax policy, governments should ... we're in a very long-standing tax regime ... we need to have a conversation about this, we're not trying to do the wrong thing, we're trying to do the right thing."We don't want to be in a situation where we get double or quadruple taxed."Asked how he would cope if Miliband were to come to power and, as promised, stop transfer pricing, Schmidt said: "If he does – if he does so, we will follow the rules." Transfer pricing involves firms shifting profits between countries.Schmidt also said Google would continue to invest in the UK, no matter what tax regime was in place: "We love you guys too much. We will continue investing in the UK no matter what."He rebuffed Miliband's suggestion there was a distinction between the letter and the spirit of the law. "You'll have to define the difference," he said to a barrister who challenged him to say whether Google would comply with the "spirit" of the tax laws, which might then lead to it being taxed more. "We're governed by US securities laws – in that scenario it might be seen as incompetence," added Schmidt.Earlier Miliband told the meeting of the firm's staff that he was "disappointed" it had paid £6m in corporation tax on UK sales worth £3.2bn in 2011. Most of Google's profits are routed through Ireland. Miliband said the US company's employees expected it to do the "right thing", as its motto was "Don't be evil."He said: "I can't be the only person who feels deeply disappointed that a great company like Google, with great founding principles, should be reduced to arguing that when it employs thousands of people in Britain, makes billions of pounds in revenue in Britain, it is fair that it should pay just a fraction of 1% of that in tax."So when Google does great things, I will praise you ... But when Google goes to extraordinary lengths to avoid paying its taxes, I say it's wrong."Labour rejected Schmidt's explanation, saying Google has been making sales to UK customers from its UK staff, but pretending the transactions were being made from Ireland so the firm could register the profits as made in Ireland rather than the UK.Booking those sales in the UK would not mean taxing profits twice – just taxing them in the UK, not Ireland.Even after profits were shifted to Ireland, Google avoids paying 12.5% corporation tax there by switching the surpluses to tax havens such as Bermuda, according to a Reuters investigation.This is done by using two Irish firms, (hence the name, "double Irish") one a tax resident in Bermuda and owning the intellectual property of the company. The offshore firm then charges the onshore one royalties, which shifts the profits out of Ireland and into Bermuda.By doing so Google would not be taxed on the same profits in different countries; it is shifting profits between tax jurisdictions to avoid paying tax.Clegg told a press conference in London on Wednesday morning: "My overall approach to tax is the obvious one. I put this directly to Eric Schmidt from Google and other business leaders at a meeting in Downing Street a couple of days ago."We are bringing the tax burden on corporations down by lowering the rate of corporation tax but in return people have to pay their fair share."He said tax havens were symptoms of the growing pains of globalisation. "You have got tax systems that are national rooted in an old economy, and now we have got these new corporate goliaths that operate in this disembodied way particularly in the digital sector, that quite unsurprisingly think they can exploit the best deal for themselves in the cracks and crevices between the national tax systems."GoogleEric SchmidtCorporate governanceTax avoidanceEd MilibandNick CleggLabourPatrick WintourCharles Arthurguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
More consumers watching TV programming on smartphones and tablets
Senators claim Apple has avoided paying billions in US tax by creating offshore entities that are not tax resident anywhereApple uses a "highly questionable" web of offshore entities to avoid paying billions in US income taxes, a Senate committee alleged on Monday.The complex arrangement includes three subsidiaries, based ostensibly in Ireland, which appear not to be designated as tax resident anywhere, the committee said. A source on the committee called them "iCompanies – I for imaginary, invisible". The commitee said that the arrangement, described by one senator as "the epitome" of tax-avoidance schemes, allowed Apple to pay only very small amounts of tax on much of its overseas profits, thanks to the Irish companies that exist "nowhere" for tax purposes.Tim Cook, the CEO of Apple, will answer the accusations at a hearing convened by the bipartisan permanent subcommittee on investigation in Washington on Tuesday. Apple vehemently denied the charges ahead of the meeting.During its investigations, the subcommittee found that Apple considers three key subsidiaries, all based in Ireland, to have no tax jurisdiction at all. One of those Irish affiliates, Apple Sales International (ASI), reported sales income of $74bn over four years but paid hardly any tax. In 2011 ASI had pre-tax earnings of $22bn but paid just $10m in tax, a rate of 0.05%."Apple wasn't satisfied with shifting its profits to a low-tax offshore tax haven," said senator Carl Levin, the subcommittee's Democratic chairman."Apple sought the Holy Grail of tax avoidance. It has created offshore entities holding tens of billions of dollars, while claiming to be tax resident nowhere. We intend to highlight that gimmick and other Apple offshore tax avoidance tactics so that American working families who pay their share of taxes understand how offshore tax loopholes raise their tax burden, add to the federal deficit and ought to be closed."Senator John McCain, the subcommittee's ranking Republican member, said Apple's "creation of companies that don't exist anywhere for tax purposes" was "the epitome of tax creativity". McCain said his constituents were "mad as hell" to learn that Apple was paying tax rates that were sometimes lower than 1%. "I've never seen anything like this."Levin said the repuercussons would be significant: "There are going to be some shockwaves, I believe, going through Europe when countries in Europe see Ireland not even implementing their own tax rate but working out a deal with Apple for a 2% rate instead of a 12% tax rate which Ireland is supposed to have."Apple released Tim Cook's statement to the committee before the meeting. In it, he robustly defended the company, denying charges that the company uses tax gimmicks and pointing out that the company has created 600,000 jobs in the US and paid $6bn in taxes to the US Treasury in 2012. Cook also defends the Irish subsidiaries, which he says now employ more than 4,000 people."Apple complies fully with both the laws and spirit of the laws. And Apple pays all its required taxes, both in this country and abroad," the statement read."Apple welcomes an objective examination of the US corporate tax system, which has not kept pace with the advent of the digital age and the rapidly changing global economy. The company supports comprehensive tax reform as a necessary step to promote growth and enable American multinational companies to remain competitive with their foreign counterparts in both domestic and international markets," Cook said.He characterised Apple's relationship with the Irish subsidiaries as "cost-sharing agreements" and said the subsidiaries shared risks as well as rewards. He said the arrangement was regularly audited by the Internal Revenue Service in the US.The senators dismissed his argument, calling the practice a loophole that needed to be closed. "This is not an agreement between independent parties. These tax agreements they talk about are people all working for Apple sitting down and signing a piece of paper which shifts profits to a tax haven, that's what it is all about," said Levin.Cook called for an overhaul of US corporate tax laws that should be "revenue neutral" for corporations. But critics charge his solutions are likely to exacerbate the issue."This is one of the most profitable companies in the world, and it has been acting like a back-alley thief trying to pick the pocket of American taxpayers," said Frank Clemente, campaign manager of pressure group Americans for Tax Fairness. He said a free repatriation would be "another mugging of the American people".The committee will report more details of its findings at Tuesday's hearing. The news comes as Apple, Google, Starbucks and others face mounting criticism of their tax avoidance schemes in the UK.Last week Margaret Hodge, the chair of the public accounts committee in the UK parliament, rounded the head of Google in northern Europe, Mark Brittin, during a hearing on the search firm's tax arranegments. "You are a company that says you 'do no evil'. And I think that you do do evil." She said the group's approach to tax in the UK was "devious, calculated and, in my view, unethical".Eric Schmidt, the Google chairman, told the Observer at the weekend:"Given the intensity of the debate, not just in the UK but also in America and elsewhere, international tax law could almost certainly benefit from reform."AppleUnited StatesTax avoidanceUS politicsIrelandTim CookDominic Rusheguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Burberry, Tesco, Vodafone and BAE Systems join CBI chief in lobbying PM to stop moralising on tax ahead of G8 talksThe bosses of some of Britain's largest multinational corporations have urged David Cameron to stop moralising and rein in his rhetoric on tax avoidance ahead of a G8 summit next month.Chief executives of companies such as Burberry, Tesco, Vodafone, BAE Systems, Prudential and GSK were keen to take a final opportunity to lobby the prime minister in advance of the meeting of political leaders in Northern Ireland.Cameron has pledged to use Britain's G8 presidency to tackle aggressive tax avoidance by multinationals, but is also keen to heed the counsel of his business advisory group, which he met with on Monday.Also present was Google's chairman, Eric Schmidt, despite the internet search firm coming under fierce attack from MPs last week because of its tax arrangements.The president of the Confederation of British Industry, Sir Roger Carr, who was at the meeting, was among those who have taken issue with Cameron's attacks on the ethics of big business tax engineering.During a speech earlier in the day at a London event organised by Oxford University's Said business school, Carr said: "It is only in recent times that tax has become an issue on the public agenda – Starbucks, Google, Amazon – businesses that the general public know and believe they understand; businesses with a brand that become a perfect political football, the facts difficult to digest; public passions easy to inflame."In what appeared to be pointed criticism of increasingly firm rhetoric from Cameron on multinational tax engineering, Carr insisted tax avoidance "cannot be about morality – there are no absolutes".In January the prime minister used a speech at the World Economic Forum in Davos, Switzerland, to put a marker down on questions of tax structuring by big business. "Some forms of avoidance have become so aggressive that I think it is right to say these are ethical issues," he said, urging multinationals to "wake up and smell the coffee".Carr said: "Tax payments are not, and should not be … a payment viewed as a down payment on social acceptability, or a contribution made by choice in order to defuse public anger or political attack."The CBI boss, who is being talked of as a successor to Dick Olver as chairman of BAE Systems, invited the G8 to consider three points in relation to tax reform:• Avoiding the moral debate – "it's all about the rules".• Fixing the rules on an international stage, not unilaterally.• Consulting on proposed changes with business.A Downing Street spokesman said the specific controversy generated by Google's tax affairs was not raised during the meeting with business leaders, though discussions did focus on "explaining the tax and tax transparency part of the G8 agenda".Also speaking at the Said business school event was Margaret Hodge MP, chair of the public accounts committee and one of parliament's most outspoken critics of tax avoidance. With Starbucks and the big four accountancy firms in attendance, she said: "Your time has now come on accountability. You are now being asked to answer certain questions and it's important that we all engage."One could argue that the way some companies organise their affairs is anti-competitive to many British companies. Especially if you look at the way Amazon arranges its affairs."On Revenue & Customs' appearance before her committee last week, she added: "Their approach, when they came to parliament last week was complacent and patronising, an attitude that actually didn't help take the committee forward. I don't think it helped members work closely together across my committee."In my opinion they are not aggressive enough. These are issues of how you judge individual companies, but at the moment I'm not clear how HMRC makes its judgments. So toughen up, HMRC."Other attendees at the event were representatives of retailer Marks & Spencer, which was accused of running its online business in a similar structure to Amazon's, and pharmacy group Alliance Boots, which recently relocated its headquarters to Switzerland.Tax avoidanceCorporate governanceConfederation of British Industry (CBI)David CameronTax and spendingHMRCG8Simon BowersRajeev Syalguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Revenue and Customs is investigating fresh lines of inquiry after interviewing whistleblower who gave evidence to WhitehallHM Revenue and Customs is investigating fresh lines of inquiry into Google's tax affairs after interviewing a former executive at the company who gave anonymous evidence to parliament, the Guardian can disclose.Barney Jones, 34, who worked for the internet company between 2002 and 2006, met officials in Whitehall on Monday and handed over thousands of electronic documents, he said. He was the primary source of allegations that led to the company being described as "evil" by Margaret Hodge, the chair of the public accounts committee, and to being accused of misleading the committee – a claim Google denied.The meeting with tax officials took place while, 100 metres away in Downing Street, David Cameron met Google's executive chairman, Eric Schmidt, but did not raise the company's affairs as they discussed future avoidance schemes, Number 10 said.The prime minister is coming under increasing pressure from the heads of some of Britain's largest multinational corporations who have urged Cameron to stop "moralising" and rein in his rhetoric on tax avoidance ahead of a G8 summit next month.The documents handed over to HMRC allegedly show how Google's London sales staff would negotiate and sign contracts with British customers, and cash was paid into a UK bank account, but the deals were technically booked through its Dublin office to minimise its liabilities here.A devout Christian and father of four, Jones, who marketed Google's services to prospective clients, said that tax officials had interviewed him and taken interest in his evidence."I have handed over everything to HMRC and I am looking forward to finding out what they make of it. I really loved working for Google. The company has got a strong tradition of being self-critical to make sure that they are consistent with their ideals. I see my allegations as simply being part of that process," he said.The row revolves around Google's use of its European headquarters in Dublin to minimise its tax bill in Britain. By booking all UK sales through Ireland, it handed HMRC only about £10m in corporation tax over the period 2006-11. It is able to record the revenues in Ireland because the UK company is deemed to drum up new business, with sales staff in Dublin executing all deals.Jones said he attended meetings where Google's London sales staff closed deals. He has contracts, invoices and correspondence between Google and its customers in Britain, seen by the Guardian.Cameron used the quarterly meeting of his business advisory group to urge big firms to back his push for international action to crack down on the use of tax havens. But he did not directly raise MPs' fury about the sums Google pays in the UK with Schmidt – who is a member of the high-level panel – or hold any separate talks with him.The California-based firm was last week branded devious, calculating and unethical over efforts to shelter its multibillion-pound profits from UK taxes, during a hearing before the Commons committee. Jones provided the committee with much of the evidence raised at the committee.Cameron's decision not to question Schmidt has raised further criticisms from his coalition partners. Lord Oakeshott, a former Liberal Democrat Treasury spokesman, said that Schmidt should be grilled by HMRC on his tax returns, not idolised in Downing Street. "Inviting Google to a meeting to attack tax dodging is like inviting Mugabe to discuss democracy," he said.Chief executives of companies such as Burberry, Tesco, Vodafone, BAE Systems, Prudential and GSK were keen to take a final opportunity to lobby the prime minister in advance of the meeting of political leaders in Northern Ireland.The head of the Confederation of British Industry, Sir Roger Carr, who was at the meeting as well, was among those who have taken issue with Cameron's attacks on the ethics of big business tax engineering.During a speech yesterday at a London event organised by Oxford University's Said Business School, Carr said: "It is only in recent times that tax has become an issue on the public agenda – Starbucks, Google, Amazon – businesses that the general public know and believe they understand; businesses with a brand that become a perfect political football, the facts difficult to digest; public passions easy to inflame."In what appeared to be pointed criticism of increasingly firm rhetoric from Cameron on multinational tax engineering, Carr insisted tax avoidance "cannot be about morality – there are no absolutes".GoogleHMRCTax avoidanceCorporate governanceSimon BowersRajeev Syalguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
The hackers were behind scores of thefts of intellectual property and government documents over the past five years, according to a report by Mandiant in February that was confirmed by American officials.
Google staged four discussions expounding on the finer points of its "Glass" wearable computer during this week's developer conference.
British business chiefs have accused Eurosceptic MPs of putting "politics before economics", and called for David Cameron to "strengthen and deepen" the European single market.
The Prime Minister has written to leaders of Britain's offshore tax havens to push for international action to tackle tax avoidance schemes.
A cyberunit of the People’s Liberation Army in China appears to have resumed its attacks using different techniques, hitting several of the same victims it has gone after in the past.
Google and Amazon face fresh attack over claims that their multibillion-pound UK-facing businesses should not be taxedGoogle and Amazon came under fierce attack from MPs and tax campaigners after fresh whistleblower allegations put further strain on claims by the internet giants that their multibillion-pound UK-facing businesses should not be taxed by Revenue & Customs.Margaret Hodge, chair of the public accounts committee, told Google's northern Europe boss, Matt Brittin, that his company's behaviour on tax was "devious, calculated and, in my view, unethical".He had been recalled by MPs after being accused of misleading parliament over the firm's tax affairs six months ago. Hodge said: "You are a company that says you 'do no evil'. And I think that you do do evil." Hodge was referring to Google's long-standing corporate motto, "Don't be evil," which appeared in its $23bn US stock market flotation prospectus in 2004.The attack on Google is likely to be echoed if, as Hodge has hinted, Amazon is also recalled to clarify evidence in the wake of a Guardian investigation into the world's largest online retailer and its UK tax arrangements.More suppliers have told the Guardian of extensive negotiations with Amazon staff in Slough, adding to the impression that the company carries out important trading activities in the UK and so could be liable for tax.One music publishing executive said: "I did millions of pounds of sales to Amazon. All buying and marketing was negotiated and run through Slough. I never heard anything from Luxembourg." A spokesman for the company said: "Amazon pays all applicable taxes in every jurisdiction that it operates within."Google and Amazon insist that sales from the UK are invoiced from other territories and any resulting profits should not be taxed in Britain, despite US bosses telling investors that they took sales from UK customers last year of £3.2bn and £4.2bn respectively. The latest published accounts for their most substantive UK companies showed tax paid in Britain of just £3.4m and £3.2m respectively.The UK is one of the most successful markets for Google and Amazon, with British customers generating more than one in every 10 dollars of sales. In both cases UK sales grew by about 20% last year.Lin Homer, chief executive of HMRC, also appeared before Hodge's committee and was asked why she appeared not to be taking a tougher line with internet multinationals. She replied: "We see – but understand more fully – some of the information that might seem to the general public to be surprising."Earlier MPs had revealed that several Google whistleblowers had approached them with detailed evidence demonstrating sales activities taking place in the UK. One former Google staff member had contacted MPs claiming he had earned bonuses of three to four times his salary for "selling and closing deals".Brittin maintained that no one working for Google UK had the authority to close a sale – that power lay only with Google Ireland. "Calling someone a 'sales rep' is not the issue here," he said. He denied misleading parliament in November when he told MPs: "Nobody [in the UK] is selling." But in an extraordinary series of admissions – during almost an hour of testimony – he said he understood how MPs, the public, some large advertisers on Google and even some of the 300 Google UK staff dealing with British advertisers might feel the group was negotiating and closing deals in the UK.Nevertheless, Brittin repeatedly insisted that, for tax purposes, all such transactions were with Google Ireland. "The UK team are selling, but they are not closing ... People here [in the UK] cannot sell what they don't own," he said.John Dixon, head of tax at Ernst & Young, said tests to determine whether an Irish company should be taxed in the UK were broader than that. An Irish company also became liable for UK tax if agents on its behalf were in effect negotiating and closing a deal. He said he could not comment directly on Google's affairs because the search company was a client.Dixon said E&Y auditors meticulously reviewed what functions were being carried out by multinational companies in each of its territories, especially if there was a question mark over its taxable presence – or, in tax jargon, whether it was a "UK permanent establishment". He said the teams carrying out this work were always separate from E&Y's tax advisers. The accountancy firm made $6bn from tax advice last year.Brittin told MPs that HMRC had been examining Google's tax affairs since 2009. He had been interviewed by tax inspectors, as had many staff who had provided detailed answers to questions in relation to the extent to the company's sales activity in Britain. Asked why, as vice-president of sales and operations for northern Europe, he was not based at the firm's European HQ in Ireland he replied: "I happen to be British. I like living in Britain."David Cameron came under pressure to remove Eric Schmidt, the head of Google, as a senior business adviser to send a message that the government was serious about cracking down on tax avoidance by multinationals. Lord Oakeshott, a former Lib Dem Treasury spokesman, said Schmidt's position was "the height of hypocrisy".He said: "If the British government is serious about tax dodgers, David Cameron must remove him from the business advisory council which is a personal appointment. Clearly Google are driving a coach and horses through the spirit of the law."Hodge said: "If I was David Cameron, I would consider Eric Schmidt's position."George Osborne has made tackling the practice a priority for Britain's chairmanship of the G8. In an interview with the BBC in April, Schmidt defended Google's practice, suggesting that its contribution to the UK economy was more important than the tax it paid to the exchequer.GoogleAmazon.comInternetE-commerceSearch enginesTax avoidanceCorporate governanceHMRCSimon BowersRajeev Syalguardian.co.uk © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds
Google is rolling out another wave of products and services that will test how much more people want computers to control their lives...
Google CEO Larry Page has disclosed a problem with his vocal cords that makes it difficult for him to speak and breathe occasionally.
The breakdown disclosed in a regulatory filing consisted mostly of stock awards that could ultimately be worth more or less money.
By Chan Myae Khine SIM cards will be sold at a dramatically reduced price of 1,500 kyats (US$2US) in Burma, making mobile phones affordable for the general population for the very first time After much anticipation, state-owned television announced on April 3 that new SIM cards for CDMA and WCDMA networks will be sold for
Rupert Murdoch tweets that the Wall Street Journal newspaper is still being attacked by Chinese hackers.
As the company begins to integrate DoubleClick, CEO Eric Schmidt said that Google's search, ads, and apps strategy has had a transformative effect on its business.