Wednesday, 20 February, 2019

Google shifted $23 billion to tax haven Bermuda in 2017: filing

The tax strategy known as the ‘Double Irish Dutch Sandwich’ is legal and allows Google to avoid triggering corporate income tax in the US and Europe Google stashed billions in offshore tax haven
Priscilla Morrison | 04 January, 2019, 20:40

Greycroft co-founder Alan Patricof on a recent surge in the entrepreneurial spirit, the state of the IPO market and antitrust concerns over tech companies such as Facebook, Google and Amazon. A report from Reuters suggests that the company did it through a Dutch shell company.

The tax strategy, known as “Double Irish, Dutch Sandwich”, is legal, but has been criticised in the past as an arrangement that allows Google to reduce its foreign tax bill.

The amount of cash channelled to the Caribbean haven through a Dutch subsidiary increased by about €4 billion that year, according to accounts filed in the Netherlands.

The tax strategy, known as the "Double Irish, Dutch Sandwich", is legal and allows Google to avoid triggering USA income taxes or European withholding taxes on the funds, which represent the bulk of its overseas profits.

More news: Chesterfield Greggs store slammed for not having any vegan sausage rolls

Previous year we featured a piece diving into some schemes multinational corporations engage in that allow them to reduce tax liabilities.

It's worth noting that the US has lowered its corporate tax rate to 21% in order to prevent corporations from moving their profits to tax havens. The island national originally set 2015 as the past year this scheme would work, but extended a grace period to 2020 for companies like Google and Apple (NASDAQ:AAPL) that engage in the practice. However, a year ago the U.S. dropped its corporate tax rate to 21 percent from over 30 percent, as well as allowing companies to repatriate funds at a much-lowered 15.5 percent.

Reuters reported that according to documents filed at the Dutch Chamber of Commerce, Google Netherlands Holdings BV paid €3.4 million in taxes in the Netherlands in 2017 on a gross profit of €13.6 million. "All foreign profits, including 2017 and prior, regardless of where they're held, are subject to corporate tax in the United States", the spokesperson said.

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