Google tax deal 'ridiculous', says TV expert Steve Lewis


Google has got off "lightly" with its £130 million UK tax payback deal, says one of the stars of a TV show that saw small firms in a Welsh town "go offshore" with their accounts.

The search engine giant has been criticised after agreeing to pay back the Treasury - which critics say brings its 10-year tax bill to effectively just 3% of an estimated £7.2 billion profit.

Most British businesses currently pay corporation tax on 20% of their profits.

Steve Lewis, who featured in the BBC Two show The Town That Took on the Taxman, branded the situation as "ridiculous".

He said: "Google must have been over the moon with how lightly it got off. They probably thought all their Christmases and New Years had come at once.

"If you look at their turnover for the UK it is eight figures - the money they should pay back should have been around £1 billion, not £130 million.

"If a small firm makes an error with its tax return there's no tolerance whatsoever. You're not in any position to negotiate - you have to pay the fine plus interest."

On Monday, the UK Government denied that Google's deal to pay £130 million in taxes owed over the last 10 years amounted to a "lower special rate" for the internet giant.

Treasury Financial Secretary David Gauke told MPs: "The statement made by Google... is solid evidence companies are changing their models because we have strengthened the rules."

Google's sales were valued at £3.8 billion in Britain during 2013 but it paid just £20.4 million in UK taxes that year.

Between 2006 and 2011 the company's revenue in the UK hit around £12.6 billion but its corporation tax payments for the period totalled £11.2 million.

Businessman-turned-TV star Mr Lewis believes there is little incentive for big companies to change their current tax practices.

The 63-year-old has since attracted almost 140,000 signatures with an online petition calling him to succeed HMRC's outgoing chief Lin Homer. That support comes following his appearance in the BBC show which saw small traders in Crickhowell, mid Wales, uncover techniques used by multinationals to avoid paying tax.

Mr Lewis, who runs the town's Number 18 Cafe alongside his wife Sam, said: "It's not just Google who are doing it either - there are lots of massive companies who have great PR about their 'corporate social responsibility' and then pay little in the way of tax.

"Regardless of whatever the tax code is or the business rates are, the philosophies of some big companies seem to be to achieve a target of zero per cent tax.

"Yes, what they are doing is not illegal and you can also say it's clever in a way too - but it shows a total lack of social responsibility."

The father-of-six believes rather than changing the law, it is people power that can force the hand of big firms.

He said: "If I became the next chief executive of HMRC I would make it a priority to publicly shame big companies who put in aggressive tax returns.

"The only way to make them change is to fear their profits and brand will be damaged.

"I'm planning to launch a big social media campaign later in the year which will target a different big company each month.

"Companies need to change their behaviour into thinking that if they file tax returns of low amounts such as 3 or 5% then they could be putting their brand and profits at risk."