Google Facebook Microsoft evade paying 2360 million euros taxes each year in 20 developing countries, an investigation reports: Google (Alphabet), Facebook and Microsoft stop paying about 2,360 million euros (dólares 2,800 million) in taxes each year in 20 developing countries, an amount that would pay the salaries of 729,000 nurses, 770,650 midwives or 879,900 primary education teachers, according to a study by the South African-based non-governmental organization ActionAid International.
This amount arises from a calculation that relates the profits earned by these companies in 2019, carried to each country in function of the number of users you have each company in 20 developing countries and adjusted by the Gross domestic Product (GDP) of each one of them, on which is applied a corporate tax of 25%, the recommended by the Independent Commission for the Reform of Taxation of International Companies (ICRICT, for its acronym in English), an organization in which you participate, among others, the Nobel Prize in American economics Joseph Stiglitz or the Frenchman Thomas Piketty.
Both Alphabet, parent company of Google, Facebook and Microsoft have increased their profits during this year 2020 despite the coronavirus pandemic. The Google Matrix entered 26.6 billion euros in the second quarter of 2020, above what analysts expected; Facebook reached a turnover of 15.7 billion, 11% more than the previous quarter; and Microsoft entered 33.000 million euros in its fourth quarter, which ends in June, exceeding forecasts and the same period of 2019.
"Women and young people are paying the price for an outdated system that has allowed big tech companies, including giants like Facebook, Alphabet (Google's parent company) and Microsoft to make big profits during the pandemic, while contributing little or nothing to public services in southern countries," says ActionAid International's global tax spokesman David Archer.
The countries included in the study are about twenty African, Asian and South American nations: Bangladesh, Brazil, Ethiopia, Ghana, India, Indonesia, Kenya, Malawi, Mozambique, Nepal, Nigeria, Senegal, Sierra Leone, South Africa, Tanzania, Thailand, Vietnam, Zambia and Zimbabwe.
Google Facebook Microsoft evade paying 2360 million euros taxes
Among them, Brazil, Nigeria and Bangladesh are the countries in which there is a greater "tax gap" between the taxes paid by Google, Facebook and Microsoft regarding what they should pay, according to the authors of this study.
To calculate the nurses, midwives or teachers that these countries could employ if they collected these taxes, ActionAid officials explain that they have used the public data of official salaries offered by 12 of the 20 countries studied, while in the other 8 they have used data from the web Worlddata.info.
According to the World Health Organization, the 20 countries studied should employ at least 1.8 million more nurses from 2030 to meet the minimum of professionals in this sector that each country must have, which is 40 nurses per 10,000 people according to the United Nations Health Agency.
For those responsible for ActionAid International these data are "only the tip of the iceberg", since they reflect three companies, so it is necessary to reform taxes on large companies globally. This organization calls for the imposition of a minimum type of corporate tax that taxes the income of large multinationals in each country, with which to finance public health systems in the pandemic.
"The COVID-19 pandemic has confirmed the urgent need to reschedule our tax systems. In 2013, the G20 asked the OECD (Organisation for Economic Co-operation and development) to implement reforms that would make it possible for profits to be declared where companies had their real activity," Alex Cobham, director of the Tax Justice Network, said in a statement.
According to their calculations, if only Alphabet paid the taxes corresponding to its activity in each country, more than 244,360 nurses could be hired in the 20 developing countries covered by the study.
The global effort to reach an agreement on a tax on large technology multinationals-popularly known as the Google Tax— has been delayed by international organizations such as the OECD, which, failing to reach a global consensus, has delayed its implementation until mid-2021.
However, Spain approved on October 15 its own tax, the tax on certain Digital Services, which will tax some of the services of the platforms, such as the sale of online advertising, intermediation in services or the transmission of user data, and will enter into force in 2021.
For its part France has approved its tax on digital services - known as the GAFA tax, by the acronym of Google, Apple, Facebook and Amazon-since the end of last year.
Google Facebook Microsoft evade paying 2360 million euros taxes
HBO only paid in Spain just over 100,000 euros in taxes and billed more than 4.5 million euros in 2019, but not counting subscriptions
HBO Spain recorded in 2019 a total of 4.6 million euros in revenue and paid for them 107,557 euros in corporation tax, as explained by The Economist on Monday.
However, according to the same media, the subscriptions of users of the platform in Spain were not included in last year's profit and loss accounts. Of the 4.6 million euros recorded in revenue, almost all came from promotional and marketing Services commissioned by HBO Nordic AB, its Swedish parent company; HBO CE and HBO Portugal.
Business Insider Spain has tried to collect some comment from HBO's press department in Spain, but for the moment there has been no response. If there is, this information will be updated.
According to The Economist, HBO Nordic AB, parent company of the platform in Europe, paid 3.7 million euros to the Spanish subsidiary for the provision of promotional and marketing services. HBO CE did the same with 569,297 euros, and HBO Portugal with 290,313 euros. In total, revenue received by the subsidiary in Spain by 4,6 million.
However, from this annual turnover that HBO Spain recorded in 2019 do not include the income that the platform receives by its subscribers in the country, deduces the aforementioned newspaper. The figures, the article details, are not public nor is it known how many subscribers there are to the service in Spain. It does abound that the Spanish subsidiary closed last year with 326.557 euros of profit.
The entanglements of tech multinationals to pay less tax
HBO Nordic manages HBO's businesses in Sweden, Denmark and Norway in addition to Spain, according to The Economist.
Precisely two weeks ago the BOE published the law governing the new tax on certain digital services (IDSD), which is popularly known as the Google tax. In the words of the president of the government, Pedro Sánchez, the objective of this new tax is to tax corporations that "are not paying taxes". "They do not pay them like the self-employed, they do not pay them like SMEs, and therefore, they introduce a very important distortion in the market."
In the middle of last year, it became known that another video-on-demand platform such as Netflix had only paid in 2018 taxes similar to those usually paid by a worker with a payroll of 24, 000 euros annually.
The Google tax will not enter into force in Spain until mid-January, but it is not ruled out that its entry into force will be extended at the expense of a possible European Commission tax or that OECD countries reach a global agreement.