Calls for coronavirus levy as Google and Facebook accused of avoiding billions in tax – Mirror Online

Posted: April 11, 2020 at 6:49 pm

Campaigners have called for a coronavirus levy on the household name tech giants accused of avoiding at least 1.3billion in tax.

The Fair Tax Mark wants a dramatic change in taxation so that international companies help fund the crippling cost of the lockdown in Britain instead of lowly-paid workers like NHS staff.

The demand come just weeks after five tech giants including Google were accused of avoiding tax worth an estimated 1.3billion in the UK last year.

Paul Monaghan, chief executive of Fair Tax Mark, said: Silicon Valley mega-corporations such as Apple, Facebook and Google should be forced, at last, to make a fair tax contribution to the public services on which they rely, just like the rest of us.

No public money, be that coronavirus bailouts or public procurement contracts, should go toward businesses that refuse to sign a Fair Tax Lockdown pledge.

This would entail a binding public commitment from them to shun tax avoidance and tax havens.

The call was backed by Labours new shadow chancellor Anneliese Dodds, who said: At a time when so many people are seeing income plummet, many tech companies are experiencing a boom.

Its more important than ever they are paying their fair share of tax. Labour will continue to push the Government to help secure vital funding for our NHS and public services at this critical time.

Britains economy is predicted to shrink by 15-25 per cent between this month and June.

And the cost to the taxpayer of the job retention scheme has been estimated at 30-40 billion over the three months.

Meanwhile Apple, Google, Cisco, Facebook and Microsoft raked in a combined profit of 8.1billion in Britain in 2018, think-tank Tax Watch UK said in February.

But it claimed they used complex financial structures to take profits offshore and pay a fraction of the tax they should have handed over.

Their UK corporation tax totalled 237million in 2018 an effective tax rate of just 2.9 per cent.

Tax Watch estimates Apple avoided a 559million bill, Google 389million, Facebook 165million, Microsoft 156million and Cisco 44million.

In the UK, Facebook paid just 28.5million in corporation tax in 2018 despite a record 1.65billion in British sales. This week it emerged Google paid 44million in UK corporation tax in the last year despite 1.6billion in revenues.

Research company eMarketer this week estimated Google made 5.7billion in ad revenue in the UK last year and will make more than 6billion this year.

Amazon paid only 220million tax on British revenue of 10.9billion.

The Government is attempting to crack down on moving profits to low-tax areas and is planning a 2 per cent digital service tax.

But campaigners say tech giants will always shift profits to tax havens unless governments work with each other.

Fair Tax Marks Mr Monaghan said: In the long term, governments need to get together and rip up the international rule book and move toward something called unitary taxation.

Profits would be apportioned to each country for tax on the basis of where real economic activity takes place. For Google this would likely see a four to five-fold rise in the corporation tax paid in the UK.

An Apple spokesman said: We are proud of Apples many contributions to economic development and job creation across the UK.

"We pay all that we owe according to tax laws wherever we operate.

"Since 2008 Apples corporate taxes alone have totalled over 100 billion dollars.

Facebook boss Mark Zuckerberg has said he accepts tech giants may have to pay more tax in Europe.

Amazon says it has invested 18billion in the UK since 2010, and generated 220million in direct taxes and 573million in indirect taxes in 2018.

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Calls for coronavirus levy as Google and Facebook accused of avoiding billions in tax - Mirror Online