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November 1, 2012

Google, Facebook, Twitter and Amazon face UK parliamentary scrutiny over tax

The UK public accounts committee will investigate the firms over their tax affairs

By CBR Staff Writer

Google, Facebook, Twitter, Amazon and global coffee giant Starbucks are facing fresh scrutiny over their UK tax arrangements.

The Public Accounts Committee in the UK has asked representatives of Google and Starbucks to give evidence over their tax affairs in the country.

Culture minister Helen Goodman has also criticised the other companies, saying that the social media giants put extra burden on the UK exchequer by adding workload of teachers, police and social workers for addressing threats and harassment on social networks.

Chairwoman of the committee and Labour MP for Barking Margaret Hodge was quoted by the Financial Times as saying: "We want to ask them for an opportunity to explain why they don’t pay proper levels of tax in the UK."

Earlier this month, Hodge queried the UK prime minister David Cameron’s decision to criticise comedian Jimmy Carr for his involvement in a tax avoidance scheme which saved him £3.3m against the background of large companies avoiding much greater sums.

"Apple, Google, Facebook, eBay and Starbucks have avoided nearly £900m. Will the prime minister now take this opportunity to condemn their behaviour as morally wrong?" Hodge asked.

In 2011, Google UK had reported a tax charge of £3.5m against a turnover of £396m.

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Google said: "We make a substantial contribution to the UK economy through local, payroll and corporate taxes.

"We also employ over 2,000 people, help hundreds of thousands of businesses to grow online and invest millions supporting new tech businesses in east London. We comply with all the tax rules in the UK."

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