Google 2.4% Rate Shows How $60 Billion Lost to Tax Loopholes

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here is why the rich can't be taxed. Obama is only getting the middle classes money
android7newfg1.jpgGoogle Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda. 

Google’s income shifting -- involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” -- helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries. 

“It’s remarkable that Google’s effective rate is that low,” said Martin A. Sullivan, a tax economist who formerly worked for the U.S. Treasury Department. “We know this company operates throughout the world mostly in high-tax countries where the average corporate rate is well over 20 percent.” 

The U.S. corporate income-tax rate is 35 percent. In the U.K., Google’s second-biggest market by revenue, it’s 28 percent.
Google, the owner of the world’s most popular search engine, uses a strategy that has gained favor among such companies as Facebook Inc. and Microsoft Corp. The method takes advantage of Irish tax law to legally shuttle profits into and out of subsidiaries there, largely escaping the country’s 12.5 percent income tax. (See an interactive graphic on Google’s tax strategy here.) 

The earnings wind up in island havens that levy no corporate income taxes at all. Companies that use the Double Irish arrangement avoid taxes at home and abroad as the U.S. government struggles to close a projected $1.4 trillion budget gap and European Union countries face a collective projected deficit of 868 billion euros.

Google Inc. European Headquarters in Dublin

The Dublin subsidiary, which employs almost 2,000 people and sells advertising across Europe, the Middle East and Africa, has more than tripled its workforce since 2006 and is credited with almost 90 percent of Google’s overseas sales, which totaled $12.5 billion in 2008.
Oct. 21 (Bloomberg) -- Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda. Google’s income shifting helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization.

Google 2.4% Rate Shows How $60 Billion Lost to Tax Loopholes
The Google Inc. company logo sits at their European headquarters in Barrow Street, Dublin.
Google Inc. European Headquarters in Dublin
Pedestrians walk past the offices of the Conyers, Dill & Pearman law firm in Clarendon House located on Church Street in Hamilton, Bermuda.

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