Google slashes overseas tax rate through 'Double Irish' and 'Dutch Sandwich' strategy

WaPo ^ | October 30, 2010 | Jesse Drucker

[NoExpectations]

NEW YORK - By employing strategies known to lawyers as the "Double Irish" and the "Dutch Sandwich," Google cut its taxes by $3.1 billion in the past three years - moving most of its foreign profit 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, according to regulatory filings in six countries.

"It's remarkable that Google's effective rate is that low," said Martin Sullivan, a tax economist with Tax Analysts. "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 Britain, 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 and Microsoft. The method takes advantage of Irish tax law to legally shuttle profit into and out of subsidiaries there, largely escaping the country's 12.5 percent income tax.

[NoExpectations]

Boycott Google. Something about their "don't be evil" motto screams "projection" to me! CEO linked to Soros

[netmilsmom]

Those evil oil companies.....no wait! XD

[from occupied ga]

Boycott Google

What a fine statement - worthy of a French Union member.

Do you think that the purpose of companies is to fund politicians' vote buying schemes or to provide profits for their shareholders? I applaud Google for escaping the rapacious looters in the US and British government. Wish I could do the same.

[pnh102]

I see nothing wrong with what Google did. All its taxes are paid for by its customers anyway. There's nothing wrong with cutting back on overhead so that more profit can be made.

Any anger here should be directed at the US government, which insists on imposing a hidden tax on people by way of a ridiculously high corporate tax.

[from occupied ga]

This sort of drivel is what you'd expect from Pravda on the Potomic. I especially like the way the author states that this legal tax strategy costs governments $60 billion - like this was a bad thing. A little comment to the government's official backside lickers at the Washington Post. This strategy saves citizens $60 billion a year and doesn't scost the government anything unless you subscribe to the viewpoint that all income and all wealth belongs to the government. A viewpoint that is firmly held by bureaucrats and politicians and most of the MSM. $60 bil that doesn't go to buy welfare votes*.

*Welfare recipients are people who are too lazy or too cowardly to steal on their own and rely on the government to do their stealing for them.

[Leisler]

I’d rather have Satan, or Soros have the money then Fedgov.

[tx_eggman]

"Boycott Google"

What a fine statement - worthy of a French Union member.

Do you think that the purpose of companies is to fund politicians' vote buying schemes or to provide profits for their shareholders? I applaud Google for escaping the rapacious looters in the US and British government. Wish I could do the same.

NoExpectations - Gotta go with f.o.g. on this one - Google minimizing its tax hit is a good thing.

Starve the Beast

[netmilsmom]

>>What a fine statement - worthy of a French Union member<<

I don’t use Google because they are interwoven with the Obama administration. I don’t care what kind of taxes they pay.

My point with the oil companies was that they, who pay more than their share of taxes, are constantly vilified by the left. Ask a lefty about how evil Google is, and you will get the “deer in the headlights” look.

[Psycho_Bunny]

Were Google politically neutral, I'd agree with you.

But they aren't: they're a left-bent company, so this comes off as hypocritical avoidance of the consequences of their political beliefs.

[o2bfree]

Google is a partner of Obama Communism... and a enabler of Democratic Fascism. They openly support Net Neutrality, Cap and Trade, Obamacare, etc.

Google has been shoveling socialist propaganda through their search rankings and news stories for years.

Going after Google for their hypocrisy is what we SHOULD ALL BE DOING. Turning the tables on the libs by using Alinsky tactics, successfully in this case, is a good thing.

Just another FRiend’s opinion : -)

[from occupied ga]

But they aren't: they're a left-bent company

A company isn't one or the other. Their top executives are undoubtedly left leaning, but their tax strategy rewards their stock holders who presumably are spread across the entire political spectrum.

[from occupied ga]

Any tax strategy that keeps money out of the government’s greedy hands sounds good to me - regardless if it’s the limousine liberals who run google or the oil companys’ executives who are doing it.

[netmilsmom]

>>Any tax strategy that keeps money out of the government’s greedy hands sounds good to me<<

Honestly, it doesn’t matter to me.
It does matter that Obama and Google are BFF.

[coloradan]

Legally not paying taxes is a good thing, but having tax laws be so complex that only multibillion dollar companies and the super-rich can afford to buy the lawyers and offshore arms and whatnot necessary in order to be able to adopt these strategies is a very, very bad thing. The tax rate should be one or two numbers, three max, with no other exceptions, exemptions, different treatments, or anything else. Here’s the number, you pay this, end of story. This would prevent government from arranging things to try to micromanage your life, and it would make tax increases or decreases clear and easy to understand, and difficult to conceal.

[Psycho_Bunny]

lol.....ok.

[Vaduz]

If CEO linked to Soros wonder how much e-mail and data has been sold?.

[montag813]

Nice job Google!

[tx_eggman]

They openly support Net Neutrality, Cap and Trade, Obamacare, etc.

Great ... and I have no problem at all going after them for this .. and more.

But going after them for legally avoiding turning over profits to Fedzilla ... not something I'd define as a problem policy for anybody.