In defense of the revenue ravaging, tax efficient master of creative destruction that is Google.
Google has revolutionized information retrieval online and provides a whole host of mainly free products and services in use by millions of individuals and firms worldwide. The search giant has spawned an entire new industry, and argueably even improved our lives. Google has achieved this without government subsidies of any kind. So although there are criticisms that can be leveled at the search giant, to suggest they are are “adding to the public burden” is ludicrous.
Lets remember Google Europe is based in Ireland and could operate without any physical presence in the UK regardless of the current exact location of their servers.
Lets not even discuss what the UK Government would even do with the additional tax revenue although for an idea visit the blog Burning Our Money.
Instead, consider HOW or WHY is corporation tax in Ireland is less than half of the UK rate? No brainer, Ireland has established itself as a high-tech-low-tax economy and there is steady trickle of firms relocating there. No surprise that Ireland’s GDP per capita is now higher compared to the UK. If only UK corporation tax were more reasonable, Google and other innovative firms may set-up shop in London rather than Dublin. Welcome to the effects of tax competition.
The article continues it’s condemnation of Google:
“Google’s massive advertising revenues have already been blamed for ravaging the finances of newspapers, broad-casters and other creative industries.”
So Google creates a superior advertising platform that allows businesses of any size to micro-target potential customers, while perfectly measuring the effectiveness of advertising dollars spent. Now they get blamed for ravaging the revenue of traditional media? By this logic, we can blame Henry Ford for ravaging the revenue of the horseshoe industry and Thomas Edison for doing the same to the candle industry.
In all seriousness, is there any wonder that readers and advertisers are going elsewhere when the Sunday Times prints nonsense promoting their self-interest like this?