TaxWatch has today written to Commissioner Vestager requesting that the European Commission open an investigation into Google’s European Tax Avoidance scheme, the Double Irish Dutch Sandwich, and specifically whether the Dutch and Irish Governments have provided state aid to the company.
Google’s tax avoidance scheme, which uses Irish and Dutch companies to funnel profits from their European operations to Bermuda tax free has been in operation since 2004, since when tens of billions of Euros a have flowed though the scheme.
As highlighted in the letter TaxWatch has sent to the Commission the scheme relies on very large royalty payments being paid from Google’s European hub, Google Ireland Limited, to a Dutch company, Google Netherlands Holdings. This company then pays another royalty to a company registered in Dublin but tax resident in Bermuda, Google Ireland Holdings.
In 2017, Google Ireland Limited transferred €14.9bn in revenues from its European, Middle Eastern and African operations to Bermuda under this scheme. This royalty payment was equivalent to 46% of Google Ireland Limited’s revenues, 65% of its gross profits. TaxWatch is asking the Commission to investigate whether these large royalty payments are the result of any special arrangement between the Dutch and Irish government and Google.