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Google The Almighty Buck

Google Used 'Double-Irish' To Shift $75.4 Billion in Profits Out of Ireland (irishtimes.com) 209

Google shifted more than $75.4 billion in profits out of the Republic using the controversial "double-Irish" tax arrangement in 2019, the last year in which it used the loophole. From a report: The technology giant availed of the tax arrangement to move the money out of Google Ireland Holdings Unlimited Company via interim dividends and other payments. This company was incorporated in Ireland but tax domiciled in Bermuda at the time of the transfer.

The move allowed Google Ireland Holdings to escape corporation tax both in the Republic and in the United States where its ultimate parent, Alphabet, is headquartered. The holding company reported a $13 billion pretax profit for 2019, which was effectively tax-free, the accounts show. A year earlier, Google Ireland Holdings paid out dividends of 23 billion euros, having recorded turnover of $25.7 billion. Google has used the double Irish loophole to funnel billions in global profits through Ireland and on to Bermuda, effectively putting them beyond the reach of US tax authorities. Companies exploiting the double Irish put their intellectual property into an Irish-registered company that is controlled from a tax haven such as Bermuda.

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Google Used 'Double-Irish' To Shift $75.4 Billion in Profits Out of Ireland

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  • by raymorris ( 2726007 ) on Monday April 19, 2021 @11:10AM (#61290618) Journal

    Of course Google used the double Irish.
    Who wouldn't when they could legally avoid a bunch of taxes. Do YOU voluntarily pay three times the amount you're legally required to?

    The double Irish was closed off by law 2018- January 2020.
    (No new ones after 2018, companies already set up that way got a year to change their corporate structure.)

    • by sd4f ( 1891894 ) on Monday April 19, 2021 @11:13AM (#61290630)
      Isn't it funny how so many of these corporations virtue signal, but when it comes to taxes, they're not all that keen on putting their money where their mouth is.
      • Comment removed (Score:5, Insightful)

        by account_deleted ( 4530225 ) on Monday April 19, 2021 @11:27AM (#61290706)
        Comment removed based on user account deletion
        • If they fail to take advantage of any legal strategy to reduce their tax liability, they would be derelict in their duty to their shareholders.

          Umm.... how do they pay share dividends on money they never officially earned?

          • They earned the money. Says so right their in a 10k. They just didnâ(TM)t pay taxes on it because of jurisdictions.
          • by Entrope ( 68843 )

            Which "they" are you asking about? Alphabet, the publicly traded patent company, has never paid dividends. The "double Irish" subsidiary paid dividends, but only to its corporate parent. That subsidiary declared the income, and paid no tax on it.

        • There are varying duties to shareholders. I don't blame a corporation for honestly minimizing their tax exposure, but I can't imagine a successful derivative lawsuit claiming that the board failed to play three card monte with revenue.
        • I don't fault anyone, corporation or person, for taking advantage of any legal way to avoid paying taxes, but Alphabet has never issued a dividend. I fault the politicians. I'm not sure why most stock has value other than people believing it has value.
          • I'm not sure why most stock has value other than people believing it has value.

            That's true of virtually everything, even money itself.

        • I always wondered how the management buyout managed to pass the scrutiny of fiduciary responsibility.

          If management has an idea on how to make the company more profitable, doesn't their fiduciary responsibility hold them to using that idea for all shareholders, versus uses it to only enrich themselves?

        • If they fail to take advantage of any legal strategy to reduce their tax liability, they would be derelict in their duty to their shareholders.

          This is not true. You either know its not true, which makes you a liar. Or you don't know its not true, which means you are not fit to take part in this conversation.

        • by copponex ( 13876 )

          You've been a corporate apologist for years. Your tongue must be raw from all the boot licking. When are you going to stand up and demand some accountability?

        • The corporate equivalent of "I'm just following orders."
        • I'd argue it's actually immoral to pay more taxes than you are legally required to. If I pay the government $1000 extra in taxes a year (which is what you're doing if you don't take advantage of "loopholes") that's $1000 that will go towards $30 staplers, more money for our already oversized military, etc... I could just take that $1000 and go buy some homeless guys meals or pay part of some poor kid's medical bills or something and do more good in the world. Or as a corporation, I could hire more people an

        • If they fail to take advantage of any legal strategy to reduce their tax liability, they would be derelict in their duty to their shareholders.

          And thus we have the corporation-as-psychopath model.

      • Isn't it funny how so many of these corporations virtue signal, but when it comes to taxes, they're not all that keen on putting their money where their mouth is.

        Indeed. Like noted conservatives The Beatles, they are not so fond of the Taxman when they become rich themselves ...

      • Isn't it funny how so many of these corporations virtue signal, but when it comes to taxes, they're not all that keen on putting their money where their mouth is.

        This is a common attack on rich people who complain their taxes are too low. When people like Warren Buffet mention that his tax rate is lower than his secretary, people argue that if he really cared, he'd pay more taxes.

        Why is this argument persuasive? How is Warren Buffet paying a few extra million going to fix our debt? He knows this. H

    • by whitroth ( 9367 )

      Pay three times the taxes they're legally supposed to? Did you read the same article?

      Or are you just a thief, stealing things (like public roads) that my taxes pay for, and you don't, forcing me to pay higher taxes?

    • Do YOU own enough politicians to get written-to-order laws allowing you to cheat your way out of paying even a pittance for the burdens you place on the society you parasitize?

    • by alvinrod ( 889928 ) on Monday April 19, 2021 @11:27AM (#61290704)
      I'm not going to dislike them for taking advantage of tax laws to minimize their burden. I do the same with my personal finances and so does everyone else assuming they know how to do it themselves or hire someone else who's aware of various exemptions or deductions available.

      What pisses me off is when these snakes do this while saying that they want a corporate tax hike [slashdot.org]. Close the "loopholes" you take advantage of first if it's such a big problem and then we can talk. Also stop asking cities to eliminate property taxes in exchange for opening an office there.
      • I'm not going to dislike them for taking advantage of tax laws to minimize their burden. I do the same with my personal finances and so does everyone else assuming they know how to do it themselves or hire someone else who's aware of various exemptions or deductions available.

        What pisses me off is when these snakes do this while saying that they want a corporate tax hike [slashdot.org]. Close the "loopholes" you take advantage of first if it's such a big problem and then we can talk. Also stop asking cities to eliminate property taxes in exchange for opening an office there.

        I wish I had mod points for this comment.

      • by DarkOx ( 621550 )

        Except the Googles of the world wont ever do that. A corporate tax hike is after all to their advantage.

        1) Its plays all the right notes for the ignorant masses - see look at google the understand my struggle and trying to make things more fair. It of course baloney but that does not matter.

        2) They know any hikes will fall disproportionately on smaller competitors, you know the kind that don't have a large army of tax attorneys and financial engineers to spot loop holes and arbitrage opportunities like thi

      • They can ask for a loopholes to be closed while still taking advantage of them while they're there. Not doing so would put them in an uneven playing field versus any potential competitors.

        IE, I'm against UBI, but you can bet if they started issuing checks I'll take one, because if my taxes are paying to issue them I might as well take what amount of it I can back otherwise I'm just shorting myself compared to others.

    • I'm tired of hearing "Do you pay more in taxes than you need to?".

      I probably do. I can't afford to spend a few million a year lobbying for tax dodges while sucking down subsidies. I was lucky to get a few thou last year during one of the greatest economic upheavals in modern history, and the mega corps fought tooth and nail against that because they benefit from a workforce on the verge of financial ruin.
    • Can YOU pull a double Irish with shell corporations all over the world? Get fucked with this "but they're only paying what they HAVE TO" bullshit.

      • Sure. But it would cost me more to get it all setup than I would save, so why bother with the effort.

        Well, at least I could have. I'm pretty sure the "double Irish" has been eliminated and 2019 was the last tax year you could use it. So despite all the money they spent on Lobbyists, they weren't able to "buy" Tax Loopholes.

    • by sg_oneill ( 159032 ) on Monday April 19, 2021 @11:52AM (#61290814)

      Legal isnt the same as Moral. Just because they CAN doesnt mean they should.

      Its egrarious that working class people have to pay upwards of a third of our paycheck to keep the state alive, whilst we struggle to keep our heads above water, whilst most of the wealth is hoarded by multinational megacompanies that just shift the wealth offshore haven and not pay a cent to that very same state for whom without the existance of capitalism, and therefore multinationals, could not exist. Then use their fat war funds to bribe and distort the demcratic will of the state to only favor the corporations over the workers.

      Its representation without taxation.

      We are paying Googles tax for them, and we never voted for that.

    • by TimothyHollins ( 4720957 ) on Monday April 19, 2021 @11:58AM (#61290842)

      As every lawyer will tell you, and what makes your argument so childish, is that society as a whole knows about 'the letter' of the law and 'the spirit' of the law. The letter is what is printed on paper, like the constitution, while the spirit is what is meant, intended, to be the effect of the law.

      Getting out of charges of rape because a police officer entered the crime scene without probable cause means that by letter of the law you were not guilty, but that sure as hell doesn't mean that you didn't do the deed.

      Google abused the letter of the law to get out of paying taxes. It is 'legal' only in the sense that they cannot be charged with a crime for it. They, and all of us here reading this, know damn well that they broke the spirit of the law and simply found a way to avoid contributing to society while taking all they could away from it.

      Do YOU voluntarily pay three times the amount you're legally required to?

      This is pathetic. No one pays three times what they are legally required to, and Google doesn't even pay what they are morally obliged to.
      Every man with a straight spine does however pay according to the spirit of the law. I use the roads built by taxpayer money, the hospitals paid for by taxpayer money, the vaccine paid for by taxpayer money, the police paid for by taxpayer money, and a lot more. Unlike you I wouldn't be able to look at myself in the mirror if I knew I was a parasite on society. I *want* to contribute to a better society, for my own pride and satisfaction; being an immoral leech would prohibit me from doing that.

    • The trick is deeply dishonest. Most people would call it lying if they knew how it works. There's a company that pretends to be four companies, so that the companies can say they don't own the intellectual property the company owns and pay license fees to each other for intellectual property, which allegedly is the only profitable part of the entire business. If you claimed that you give all the money you earn to your twin brother, who for all intents and purposes is you and lives in the Bahamas, to pay him

    • No, but I also don't go out of my way to attempt to reduce my tax burden to $0 but still reap the benefits of the stable democracy in which I live and work. I pay my taxes because society has a value to me and while I could probably find some accountants with barely-legal schemes to keep my money out of the hands of the government, that's not what I want.

      When I have fantasies about being a billionaire and spending my vast wealth, the biggest one is to lobby the government to implement a tax regime whereby b

    • by ljw1004 ( 764174 )

      Do YOU voluntarily pay three times the amount you're legally required to?

      Yes I do. I refrained from setting up a tax-minimizing trust, I refrained from incorporating myself as a business and writing off home improvements as tax expenses, I refrained from off-shoring my assets, and so on. I managed to refrain because (1) it's basically not fair for me to do these things, to take advantage of tax structures only available to people with above a certain amount of money+time, (2) I'd rather invest my time into making my life more balanced, and contribute the output of my professiona

      • Do YOU voluntarily pay three times the amount you're legally required to?

        Yes I do. I refrained from setting up a tax-minimizing trust, I refrained from incorporating myself as a business and writing off home improvements as tax expenses, I refrained from off-shoring my assets, and so on. I managed to refrain because (1) it's basically not fair for me to do these things, to take advantage of tax structures only available to people with above a certain amount of money+time, (2) I'd rather invest my time i

  • by Anonymous Coward

    Why do such loopholes even exist? It's no wonder countries can't afford to take care of their own citizens when billions of dollars in taxes are missing from a single company. And how much is lost in taxes when you add Amazon, Apple, Facebook, Google, Microsoft and Twitter?

  • Congress takes their "donations" and lets corporate lawyers write US laws. The founding fathers would probably execute them for treason. Yet, we live with this corrupt reality every day. Will Biden's people change the status quo? Do they know how? I hope so. A minimum tax, with no loopholes, on huge corporate profits would be a nice start.
    • Nope.
      These companies are simply HQed outside, so as to avoid taxation here.
      Europe has this right. We need a CONSUMPTION style taxation, which is they have a VAT. This removes all the write-offs, tax breaks, exemptions, etc from the formula.
      We could probably do the same with Sales tax, but there is a lot to like about VAT, esp. if it is progressive.
    • /Oblg. But America has the best government money can buy! /s ;-)

      Part of the problem is Corporate personhood [wikipedia.org].

  • by ickleberry ( 864871 ) <web@pineapple.vg> on Monday April 19, 2021 @11:21AM (#61290670) Homepage
    The unfortunate thing about it is these megacorps have the likes of Fianna Gael in their pockets. The IDA will rush over to the states to entice new megacorps in and they're quite happy to see Google pay nothing as long as Ireland can have the prestige of being home to a large Google office, they somehow think this fact will draw in other megacorps, or perhaps yield brown envelopes in some way.

    It's daft that they'd rather tax some poor auldwan living in a tiny cottage in Mayo to live in their own cottage than make these megacorps pay their way. Then they go out of their way and spend their own money to fight for Apple's cause when it turned out they owed 13 billion.

    There is a lot of rumbling also about UBI and how it will be everyone's saviour when the Google robot overlords take over the world but 0 talk about how it's going to be paid for. Really they should be taxing the absolute bejaysus out of any heavily automated business and it should be on the purchase side - 50-70% VAT for anyone buying google ads would be a start. Of course these big corps hand out so many brown envelopes the stupid cnuts of politicians would try to raise the money from stamp duty on cheque books or income tax from the few people left in this country who actually try to produce some useful goods.

    Recently due to Covid there were some government grants people running small businesses could get to open an online store. Of course many recipients pump this money straight into the Almighty GOOG for online ads. I know at least one person who did this. Really there should be a grant for starting up a competitor to Google Ads in Ireland but of course no such luck.

    TLDR;? Irish govt will try to shaft the ordinary Joe trying to eke out an existence every time and freely hand over the money to megacorps
    • by nagora ( 177841 )

      TLDR;? Irish govt will try to shaft the ordinary Joe trying to eke out an existence every time and freely hand over the money to megacorps

      Well, yes. The same Irish govt that protected* the IRA murderers who fled over a border they did nothing to enforce but start bleating about how important it is to enforce the same border the moment it might cost them some tax revenue. I mean, dead people is one thing but losing money is serious.

      So, yeah. Banana Republic, as the man said: Glad to see the place again;It's a pity nothing's changed.

      *Or indeed were the IRA murders.

  • Remind me why (Score:4, Interesting)

    by fred6666 ( 4718031 ) on Monday April 19, 2021 @11:22AM (#61290678)

    do we need to allow trade with tax havens such as Bermuda again? Do they produce anything worthwhile?

  • Blame CONgress, Presidents and most of all, the GD GOP and Dems.

    All of these ppl are the ones responsible not for taxation, but for the CUTS and Write-offs they have given them. Probably the worst was in 2005, when the GOP and W re-did corporate taxes and actually made it legal and easy to do this garbage.

    Far better is for America, in fact the west, to get rid of ALL corporate write-offs, tax breaks, exemptions, etc. and then simply put a straight tax on gross sales receipts, say 1% if truly located i
    • Far better is for America, in fact the west, to get rid of ALL corporate write-offs, tax breaks, exemptions, etc. and then simply put a straight tax on gross sales receipts, say 1% if truly located in the nation, OR 5% if located outside.

      lol none of your woke overlords, limousine liberals, or woke corporations (ahem e.g. Google) actually want that.

  • by OrangeTide ( 124937 ) on Monday April 19, 2021 @12:02PM (#61290860) Homepage Journal

    How many of these tax dodging companies would it take to pay for universal free 2-year college for everyone in the US? Let's pretend that of the $12B, they probably should have paid 20% to either US or IE. Wouldn't take too many $2B revenue streams for either country to pay for programs that promote long-term improvements in the standard of living of their people.

    Of course, I'm sure some nutter will want to argue about how it's oppression and destroys capitalism. But people are free to have their opinions, even if they don't know what kind of capitalism we have [wikipedia.org].

  • A 35% tax on the difference between what a company claims as profits on it's tax forms and what it claims as profits on it's balance sheet. There goes the incentive to shift profits.

    And, before someone says "They will just move the company overseas", it is simple to require a company have a wholly owned subsidiary in the United States which is used to tax the income of the subsidiary BEFORE profits are shifted to the parent corporation.
  • The corporate tax structure exists not because it is fair and not because it is a workable way to raise government revenues but because it's politically popular to talk about Sticking It To The Man, regardless of the real-world effects.

    The statutory corporate tax rate in the US is one of the highest in the world, much higher than most places in Europe, and we have a 'worldwide tax' meaning that a company based in the US has to pay US tax on revenue even if it's for something that from start to finish was pr

    • by careysub ( 976506 ) on Monday April 19, 2021 @01:43PM (#61291242)

      The statutory corporate tax rate in the US is one of the highest in the world, much higher than most places in Europe

      The facts change, but the claims remain the same, decade after decade. The current U.S. corporate tax rate is 21% which is below the world average of 23.85% [taxfoundation.org], so no, the U.S. is far, far away from having "one of the highest in the world".

      More relevant than any statutory rate is the actual rate that is paid, since any number of special rules can be used to eliminate corporate taxation mostly, or entirely - as 91 of the Fortune 500 managed to do last year.

      When one computes the actual tax rate (as a percentage of GDP say), it turns out the U.S. has one of the lowest corporate tax rates in the developed world, 36th in the OECD in 2018 in fact (data found here [oecd.org].

    • by schwit1 ( 797399 )

      This. Our current tax system is designed for tax avoidance and evasion.

      We need a consumption tax instead.

      Buy electricity, invoice includes a consumption tax
      Mechanic works on your car, invoice includes a consumption tax
      Google charges for its services, invoice includes a consumption tax

      Get rid of 1040s and April 15, probably much of what the IRS does today.

  • Companies exploiting the double Irish put their intellectual property into an Irish-registered company that is controlled from a tax haven such as Bermuda.

    ...a strategy that works because western politicians have been bought/bribed/sorry "received campaign contributions" in order to build the loopholes into tax laws that allow that shit.

    Why they're still in office and not in jail will be something future history classes will debate hotly.

  • Pardon my naivety on the subject, but when everyone can plainly see what is happening, and they objectively know it is a loophole, why don't they just close it, and expressly define specific circumstances where it is actually *intended* to be used?
  • The solution to this problem is so simple

    - Abolish all corporate income tax that is spent on R&D, capital infrastructure, and wages

    - Increase the tax rate on dividend payouts, so they are taxed higher than regular income

    These two simple changes would make it so that all income comes back home, and is immediately re-invested in the company - growing jobs and wages massively. Companies would have zero incentive to offshore income. The taxes the government would take in from income taxes on the employment

    • This can be applied more generally and have all tax evasion and avoidance eliminated by abolishing all taxes.

      Next we can abolish all crime by making everything legal.

    • - Increase the tax rate on dividend payouts, so they are taxed higher than regular income

      Dividend payouts are not corporate income. They are the profit share paid out to share holders and are taxed as personal income. They are why 401K accounts, pensions, and people invest in stocks with a good yield. What you are suggesting would hurt retirees, encourage people to sell stocks because no dividends, and encourage increases in payout and benefits to executives.

      Abolish all corporate income tax that is spent on R&D, capital infrastructure, and wages

      >

      You seem ignorant of corporate income tax. A corporate income tax levied by federal and state governments on business profits. The p

  • Let's make sure we criticize a software company for optimizing how the money flows. Because optimizing a flows is not something that a software company would ever even contemplate doing. Let's talk about their "responsibility" to pay taxes (which they already do to the extent that the law requires it). The responsibility to collect taxes is on the governments. The ****responsibility**** to *legally* minimize their tax burden is on everyone paying taxes. Voluntary compliance with tax laws does not imply
  • How is this controversial? It implies some sort of equitable disagreement between a large number of people on the legality and ethicality of this. I think you'll find everybody thinks this a unethical dick move except Google's shareholders.

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