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Dublin: 12 °C Thursday 18 September, 2014

UK officials face questions over multinational tax affairs

The Commons’ Public Accounts Committee is said to be skeptical about Google’s explanations of UK ad sales booked through Ireland.

Commons' Public Accounts Committee chairwoman Margaret Hodge.
Commons' Public Accounts Committee chairwoman Margaret Hodge.
Image: Screengrab

UK TAX OFFICIALS are being quizzed by MPs today over the tax affairs of multinationals after claims that advertising sales made by the Google in the UK are being booked in Ireland.

Head of business tax at HM Revenue and Customs Jim Harra is facing the Commons’ Public Accounts Committee (PAC) flanked by two other executives and is answering questions about multinationals such as Google, Amazon and Starbucks.

Sky News says that a report by the PAC describes Google’s claim that the sales for UK ads are made in Ireland as “deeply unconvincing”. It added that the company’s account of its operations made “absolutely no sense”.

The hearing comes as the Irish Government announced that it intends to no longer allow companies to be “stateless” as it attempts to shed the growing worldwide image of Ireland as a tax haven.

The so-called ‘double-Irish’ tax strategy whereby companies route their multinational sales through Ireland and onto another Irish company set up in tax havens such as Bermuda and the Isle of Man has been criticised in particular by US Senators.

PricewaterhouseCoopers’ Dublin-based head of tax services Fearghal O’Rourke told Bloomberg News today that “under no circumstances is Ireland a tax haven”. The article says that O’Rourke counts Google and Twitter among his clients and quotes him as saying that the multinational companies that have chosen Ireland as a bases are legally finding ways of avoiding taxes.

Read: Noonan cracks down on ‘stateless’ companies registered in Ireland for tax >

Read: Ireland is Apple’s ‘Holy Grail of tax avoidance’ >

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