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Google avoids tax with ‘Double Irish Dutch Sandwich’


seabhcan

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Google avoids tax with ?Double Irish Dutch Sandwich? ? The Register

We've all heard about this scheme, which is essentially used to avoid paying Irish corporate tax.

In the example given in the article, when an Australian company pays for Google services, they actually pay to Google Ireland. Then, Google Ireland pays royalties to its parent company in Holland - meaning Google Ireland's profits are reduced on paper and they pay less tax on them. Then the Dutch company pays the money back to another Google-owned Irish company, which then pays it on to Barbados.

Under Dutch law, and because EU member countries do not charge withholding taxes on transfers within the EU, the transfers to and from the Netherlands are essentially tax free.

And under Irish tax law, the second Irish resident subsidiary is not taxed on the royalty payment because it is controlled by managers elsewhere.
It sounds like it would be very easy to fix this by charging tax on the profits sent to Barbados. How much revenue does Ireland lose by allowing this to continue?
 


Analyzer

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sounds like they are acting the Bonox.
 

TheWexfordInn

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For anyone who hasnt seen this Taiwanese video before, it gives an explanation of the "Double Irish" "Dutch sandwich" from 30 secs to 1 minute in.

[video=youtube_share;WHUyCUPb8QU]http://youtu.be/SzuWvfNDC_A[/video]
 

firefly123

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Wasn't their message 'don't be evil' back when they started? I guess that's gone now.
 

sadcitizen

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We make a big contribution to the Irish economy by employing around 2,500 people in our European HQ in Dublin, helping hundreds of thousands of businesses to grow online and we've invested €75m in our recently opened data centre and another €226.9m in the acquisition of three office buildings in Dublin in 2011 alone.
We have an obligation to our shareholders to run our business efficiently and we comply with all the tax rules in Ireland.

Stunningly brazen. It inexplicably makes me feel a little bit pathetic, being associated via citizenship with the enablers of this situation.
 

Samell

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So that is 0.02% per year, How close to ZERO is that in real terms, we are expected to pay more than that rate in property tax FFS
 

bob3367

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Those Sales do not occur here, they are only accounted for here.

But the usual thicks will make a story out of it.
 

Con Gallagher

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The British tax advisor said it best about Ireland not asking questions; not only do we have a strikingly low effective tax rate but crucially we don't audit multinationals. Obviously we should. Every attempt should be made to make the effective tax close to the low headline rate. If we don't do it, the EU/Brits/US will take their own measures which will be far more damaging to the Irish economy.
 

macs magic

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Stunningly brazen. It inexplicably makes me feel a little bit pathetic, being associated via citizenship with the enablers of this situation.

They think we should bow down and rejoice that we are the chosen ones to host them.

I wonder could all the Irish SME's that are going bust take advantage of these tax laws without getting jailed.
 

cimon9999

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GOOGLE Ireland paid a puny 0.14 per cent tax on sales of over €47bn in seven years, the Sunday Independent has found.
What rock have they been living under?
 

goosebump

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Those Sales do not occur here, they are only accounted for here.

But the usual thicks will make a story out of it.
That point is constantly missed.

If Google were paying 40% tax on their *Irish* sales to the Irish Exchequer, which is what the EU ultimately wants them to do, they'd be paying us even less.
 

gijoe

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Con Gallagher

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That point is constantly missed.

If Google were paying 40% tax on their *Irish* sales to the Irish Exchequer, which is what the EU ultimately wants them to do, they'd be paying us even less.
And paying a hell of a lot more in taxes to EU countries where the sales are generated. How unreasonable of them!
 

bob3367

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That point is constantly missed.

If Google were paying 40% tax on their *Irish* sales to the Irish Exchequer, which is what the EU ultimately wants them to do, they'd be paying us even less.
Exactly, in effect we are getting tax revenue for non Irish sales....free money, along with all the other taxes they pay.
 

bob3367

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They think we should bow down and rejoice that we are the chosen ones to host them.

I wonder could all the Irish SME's that are going bust take advantage of these tax laws without getting jailed.
It was FF who got them here, on the point of SMEs, name one that has a turnover of €47bn with thousands of employees.
 

GDPR

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In the tax code there is a case for a minimum tax rate which is applicable regardless of any tax avoidance schemes, a minimum which cannot be avoided. Ever. E.g you could give 100% away to charity yet still owe revenue and if you don't pay revenue you go to jail.. This makes perfect sense as if everyone avoided paying tax the state would collapse.
 

Con Gallagher

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Those Sales do not occur here, they are only accounted for here.

But the usual thicks will make a story out of it.
Google generated 35% income from its revenue (which fell to 19% in the last quarter). It's profit is over €2bn. Not all of that is accounted for in Ireland, as it pays a mere €70m in tax. There is a very strong case for aggressive auditing here (and elsewhere) so that google pays its fair share in taxes (to whomsoever it is owed).

Google Hit by Weak Results - WSJ.com
 

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