The ‘sweetheart deal’ between George Osborne and Google exposes the attitude at the heart of the Tory government.
By offering ‘mates’ rates’ to such businesses in the city, the Chancellor has shown exactly what David Cameron really meant when he said “we’re all in it together” – more rich snouts in the trough financed by cuts for the poor and needy.
The prime minister tried to defend the deal by which Google agreed to pay a pathetic £130m in back tax to HM Revenue and Customs.
The payback may be a lot of money to you and me, but it is peanuts compared with the billions of dollars that the multi-national has generated. It works out at a tax rate of just three per cent compared to the basic rate of 20 per cent for the rest of us.
European MPs, Westminster’s public accounts committee and even some Tories want Osborne to publicly explain the deal.
One MEP may have hit the nail on the head by suggesting a deal to turn the UK into a tax haven to attract multi-nationals.
After six years of negotiations, HMRC appears to accept that the revenue Google UK is generating in the UK can continue to be ‘booked’ in Ireland, where it allocates the profits for tax purposes, rather than UK.