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back to article Eric Schmidt: 'Google IS a capitalist country... er, company'

Google is just conforming to the way the global tax system works, the company's executive chairman Eric Schmidt said today as he rejected the criticism levelled at the ad giant by Labour leader Ed Miliband. "We're trying to do the right thing, not the wrong thing," Schmidt said. He was speaking at Google's annual Big Tent event …

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Anonymous Coward

So pretending that money earned in the UK using UK infrastructure is actually earned elsewhere and paying taxes in Ireland is the right thing?

I can pay a builder cash and we can both dodge some tax, is that the right thing?

It may be the right thing personally, but you're dodging your obligations. Any tax shortfall from business is always going to be made up for by taxing fuel, individuals and taking the money out of the pockets of pensioners. Is that right?

I could see his point if he talked about needing to be competitive with other companies, but he's not said this.

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So the cost of developing the software does not have to be factored in ?

Paying a builder dodge some tax some tax is is illegal, what Google and MP Margaret Hodge's family owned steel company does to side step Tax is legal - big difference.

Eric is correct the issue is the law - but MP's like Ms Hodge, or ex PM's like Tony Blair don't want this changed because they will pay more Tax, they just want you to think it's the other guy's that are the problem.

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Anonymous Coward

It's more like buying all the materials that your builder needs, getting all of the engineering work and architectural work done yourself and only paying him for his time, in order that he can keep under the VAT limit.

ie: It's dodgy as hell, but not actually illegal.

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Anonymous Coward

I believe that the Telegraph had to apologise to MH for suggesting in-propriety. Furthermore, if her family were murderous jail-birds, would that make her a murderous jail-bird by association?

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Pint

"So pretending that money earned in the UK using UK infrastructure is actually earned elsewhere and paying taxes in Ireland is the right thing?"

It is if you're an accountant working for the benefit of shareholders.

It's just not the most honest, honourable and morally decent thing to be doing.

I -personally- would not dream of short-changing the society which educated me, treated me when I was sick, supported me when I was impoverished and made my life far better than that of 99% of the planet. But businesses do not see themselves as indebted or bound to a society

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Joke

You mean impropriety. </pedant>

And yes, it does make her a murderous jailbird by association, once she gets out of her human skin suit and we see her for the Slitheen she really is.

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Anonymous Coward

Eric is correct the issue is the law

Actually, no. The issue is that Google apparently lied on where their sales took place, so the law is correct, but what Google states to avoid tax seems to be in question. The rest is BS.

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Go

"Google is a capitalist country... company"

That's this Friday's headline QOTW right there.

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Anonymous Coward

Re: "Google is a capitalist country... company"

Except Google, like a great many other companies (and some countries) are not traditional capitalist, but more like monopolist-corporatist. And in Google's case, in an even more unpleasant way than the term might imply.

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Re: "Google is a capitalist country... company"

No, just capitalist. Their aim, like every other PLC, is the acquiring of capital.

That capitalism left entirely unchecked can well end up turning into outright corporate fascism, especially when helped by a hundred or so years of lawyering and abuse of laws designed to protect actual physical people.. well, that's a debate I guess. Still capitalism though.

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Big Brother

"Governments have a lot more power than we do ... if the law changes, we will follow it."

Of course, the $18 million Google spent on Washington lobbyists in 2012 has absolutely no bearing on those tax laws.

http://www.opensecrets.org/lobby/clientsum.php?id=d000022008

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Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

Currently this is true. he also said the other day that they need a territory with no laws preventing from experimenting with outdated notions of privacy. So, I expect he will shortly announce that Google has bought a country. And, some nukes.

All hail Googlonia.

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Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

Governments have more power than Google.

Would be interesting to see that statement in practice at election time.

Imagine what would happen if they decided to back one party over another when it came to search results.

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Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

Potentially being able to influence the result of a process of government isn't anything like having more power than, or even as much power as, government -- were Google so equipped, they could just tell the revenuers to get stuffed, or else to take their best shot.

Put more simply: How many divisions has Google?

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Anonymous Coward

Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

"So, I expect he will shortly announce that Google has bought a country."

Why do you think Smhit visited North Korea?

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WTF?

Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

But Comrade Stalin, they have three Popes! ... oh, I see your point.

Larry Ellison owns 98% of a Hawaiian Island surrounded by 200 miles offshore protected by Aircraft Carriers. How many Aircraft Carriers does the big guy own ? Don't tell him, it will hurt his fragile ego. And if you work for Oracle he will have Three Generations enslaved - or the other two, anyway, you're good.

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Anonymous Coward

Re: "Governments have a lot more power than we do ... if the law changes, we will follow it."

"Of course, the $18 million Google spent on Washington lobbyists in 2012 has absolutely no bearing on those tax laws."

Well, most, if not all, people would spend a trivial % of their pocket change if they had a chance to "convince" the law-makers that their kind should pay less tax! :)

trouble is, the economies of scale for "most people" mean they can't afford to convince those law-makers. So yes, you're poor, you pay up or else. You're rich, you use the system to the full. To your full advantage, that is.

Point being? Well, unfortunately, that a huge majority would love to do exactly the same, so let's get off the high horse.

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WTF?

Free Services

"As for the value of Google to the British economy, Schmidt pointed out that the company's "free" services were widely used by UK citizens."

And we would like to point out that the protection of the emergency services for their offices, the schools that educated many of their UK employees, the roads, the civil structures within which they operate are what we call a civilized society, and the price of that is you pay your effin taxes. Not treat financial transactions made of money as though they were bits of data to be optimized. Google, you owe us some schools and hospitals.

Also, we know what the exchange is for the services - they get to profile us for advertising. I missed the logical step where he explained why that has anything to do with not paying tax.

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FAIL

Re: Free Services

".....And we would like to point out that the protection of the emergency services for their offices, the schools that educated many of their UK employees, the roads, the civil structures within which they operate are what we call a civilized society....." I think you'll find that Google's UK employees paid taxes on their wages which went towards the emergency services, schools roads, civil structures, etc.

What Google is doing is not illegal, as Deadhead Silliband knows full well when he uses the issue to score political points with the clueless. Even if we were to sign up to the full European disaster of one financial system, with uniform taxes, it would make zero difference as they would just relocate their tax avoidance mechanism to countries outside the EU. The chances of getting every country in the World to agree uniform tax rates and rules is tantamount to that of a snowball in Hell.

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Re: Free Services

" Deadhead Silliband"

That made me chuckle - I like childishness. But it also meant I couldn't take the post seriously.

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Anonymous Coward

Re: Free Services

"The chances of getting every country in the World to agree uniform tax rates and rules is tantamount to that of a snowball in Hell."

Probably true at the moment, though the "every country" is largely irrelevant, all it needs is a few major trading nations.

BUT the behaviour of companies like Apple, Barclays, Google, etc, and the beggar-my-neighbour behaviour of countries like Ireland, Luxembourg, and the Netherlands, both help to increase the chances of something being done.

After all if even PR-merchant Cameron sees it as headline fodder needing addressing on an international basis, you surely have to admit there's a problem somewhere?

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Anonymous Coward

Non-free Services

Google services are not free. They are paid for with personal details, in some cases in direct breach of EU and UK law.

We really need to get rid of that idea that Google's services are "free" - that's simply a dangerous lie.

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Facepalm

Re: Professor Clifton Shallot Re: Free Services

"......But it also meant I couldn't take the post seriously." Unfortunately you seem to have confused me with someone that cares. I apologise unreservedly for any affront that has caused your over-developed sense of egocentricity, but has no-one even hinted to you that you may not be the centre of the universe? Seriously, are all the people posting here really think they are posting here to sway public opinion for The Greater Good? Get over yourselves, you sound almost as silly as Deadhead Ed.

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'Allo 'Allo

I just wish that Eric Schmidt didn't always remind me of Captain Hans Geering from 'Allo 'Allo.

(Does that comment qualify under Godwin's Law?)

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"We need to fight for privacy or we are going to lose it."

I can't help but feel some sort of spacial rift should have opened immediately after he made this statement.

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Re: "We need to fight for privacy or we are going to lose it."

Apparently he was on stage with nice Cartman and a several audience members were murdered by psycho killer pets.

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Champions of privacy

Champions of privacy! Champions of privacy! Don't make me laugh. Champions of keeping our valuable personal data private to themselves so they alone can milk it to the fullest extent permitted by the law. I'll grant him that.

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Re: Champions of privacy

So you would like them to make the data they collect public, so that any company can use it ?

My understanding is that they keep your data private to you, unlike what I understand skype(Microsoft) does. For example they hand your data to third parties, an example of this I understand can be found in skype messaging, just enter a url for a private web site and watch bing try and scan it ?

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Re: Champions of privacy

I'd like to keep my data private and charge Google for the privilege of using it. I'll let them have my name and email address for a nominal sum but for more sensitive data I'll want more money.

It's my choice to keep it a secret that I like pleasuring marsupials while wearing a deep-sea diving suit!

Oops...

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Re: Champions of privacy

"So you would like them to make the data they collect public, so that any company can use it"

No, clearly not, that would be dumb. I think you are missing the simple point your data is hardly private when you have shared it with a mega corporation the size of a small city.

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Anonymous Coward

Re: Champions of privacy

Champions of privacy! Champions of privacy!

Yes, that made me laugh as well. They are breaking Data Protection laws with some of their services every single second of the day. But hey, I can understand him stating that. After that, most of the world bought "do no evil as well" (some still do - watch the downvotes) so it's worth a shot.

The guy is about as believable as Tony Blair, but minus the smarmy smile.

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FAIL

"Virtually all American companies operate like this."

Well, all *International* American companies do.

I rather suspect that, for example, a small chain of grocery stores in an American city pays more to the Tax Man (as a percentage) than Google do.

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WTF?

"We need to fight for privacy or we are going to lose it."

Must be another variation of "we had to destroy the village in order to save it."

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Pint

Re: "We need to fight for privacy or we are going to lose it."

Damn sceptics.

Would Eric Schmidt Mai Lai to you ? Would he Mai Lai to you Honey ? Would he tell MP's something that wasn't true ? I'm asking you Sugar would he Mai Mai Lie to you ?

Sorry, got to thinking about something else.

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Stop

Fixed it.

> "no doubt governments need more money."

"no doubt governments *want* more money."

Fixed it.

"Need" is highly dubious in this context.

What *we* need is for the buggers to stop wasting so much of it.

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Stop

Re: Fixed it.

""Need" is highly dubious in this context."

Have you been to A&E or an inner-city classroom recently?

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Facepalm

@Psyx Re: Fixed it.

"Have you been to A&E or an inner-city classroom recently?"

Have you seen the waste, excess, and abuse in other parts of government recently?

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Flame

Re: Fixed it.

> Have you been to A&E or an inner-city classroom recently?

Yeah, I'd just wish they'd spend our money on them instead of giving most of it to the f*cking EU.

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Big Brother

I can assure from a privacy perspective ... we would lose you and not get you back.

As for those of us who are paying attention, you've already lost us and you will not be getting us back. The only ones you haven't/won't lose are the great unwashed who don't pay attention or even worse, are willing to give up privacy for the shiny trinkets you dangle in front of them.

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Anonymous Coward

Re: I can assure from a privacy perspective ... we would lose you and not get you back.

Google hasn't just lost us - it turned us into activists.

I never was a privacy activist until I started researching just what Google gets up to. That is simply so blatantly ignoring the law and our rights that it amounts to plain abuse. It's walking over basic human rights with big fat hobnailed boots.

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Re: I can assure from a privacy perspective ... we would lose you and not get you back.

Just remember, while "hacking" is illegal, poisoning a database is not.

Favourite ALL the cat videos!

Oh and don't forget TrackMeNot. Perhaps someone could make a gmail version that works with everyone else who has the gmail version to randomly email each other random snippets generated from random web searches?

If you can't go under the radar, obliterate the fucker with chaff and flares.

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Facepalm

This is just Ed Miliband posturing with Labor's anti-corporate base....

If Miliband was serious about legislation to solve these tax avoidance issues, he would be speaking quietly with his colleagues in Parliament to build concensus for a change.

Instead, he's out bashing Google publicly at Google's own event. This is all about Ed trying to convince Labor supporters that he is on the side of workers against big, bad corporations.

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Flame

"There's this concern that we are somehow going to misuse this data"

Not at all, my good Mr. You-Have-No-Privacy-Get-Over-It Schmit. Oh, you thought we'd forgotten that ? We never will.

We're not "concerned" that you are "somehow" going to misuse the data. We are CERTAIN you are going to index that data seven ways to Sunday and sic your advertisers on us with it.

Difference.

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Headmaster

Re: "There's this concern that we are somehow going to misuse this data"

> Mr. You-Have-No-Privacy-Get-Over-It Schmit.

Wasn't that Scott McNealy?

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WTF?

it's the law!

Looks like google where cheating on sales locations but in general public companies are legally obliged to make money for their shareholders, surely if they paid more tax than legally required to the board could be sued?

I do have *some* sympathy with companies, more so than with government who can't set better laws or get HMRC to chase the b*ggers harder. Cameron wants to employ investigators to ensure the disabled aren't claiming an extra £1 they aren't legally entitled to but doesn't want to spend money to ensure Google doesn't have loop holes to walk away with a few £(b?)million.

Stuff the letter of the law, companies not seen to comply with the spirit of the law should get no gov grants or public business. As for the public sector employing accountants who actively pursue aggressive tax avoidance - it seems like turkeys voting for an early christmas, except we are the turkeys.

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