Google parks $10 billion in Bermuda, avoiding $2 billion in taxes

Google reportedly avoided another $2 billion in taxes thanks to outsourced banking, which has already dubbed "immoral" and an "embarrassment" in media as austerity budgets reshape Europeans' lives.

The California-based Internet giant shifted $9.8 billion in revenues into a no-tax Bermuda company, cutting its overall income tax rate almost by half, Bloomberg cites the company's subsidiary financials as showing.Information disclosed on the increase in Google’s revenues routed to Bermuda could add fuel to the outrage spreading across Europe and the US over corporate tax dodging, the agency reports.“The tax strategy of Google and other multinationals is a deep embarrassment to governments around Europe,” Richard Murphy, an accountant and director of Tax Research LLP in Norfolk, England, told Bloomberg. “The political awareness now being created in the UK, and to a lesser degree elsewhere in Europe, is:  It’s us or them. People understand that if Google doesn’t pay, somebody else has to pay or services get cut.”In Ireland, Google paid a whopping 0.14 per cent tax on sales of over €47 billion over a seven-year period, the Sunday Independent found out, compared to 21 per cent paid globally. The company keeps tax bills low through a system of transfer pricing – royalty payments filtered through Ireland, the Netherlands and ultimately Bermuda, the paper reports. Conservative MP Charlie Elphicke stressed that Google’s tax charge in Britain was only £3.4 million ($5.4 million) out of declared earnings of £2.5 billion.Google's technically legitimate so-called "double Irish/Dutch sandwich" tax strategy is attracting new attention as other top US corporations faced tough questioning by British MPs last month. Google, Starbucks and Amazon were accused of leaking tax revenues from the UK to tax havens abroad, actions that were labeled “immoral.” Last week, the European Commission advised member states to create blacklists of tax havens and adopt anti-abuse rules in a move to fight the tax evasion and avoidance which costs the EU $1.3 trillion a year. Commissioner for taxation Algirdas Semeta called the tax maneuvers “scandalous” and “an attack on the fundamental principle of fairness.”According to Google, it complies with all tax rules, and its investments in various European countries help their economies.