U.K.’s Cable Says Governments Should Take on Google Over Tax

U.K. Business Secretary Vince Cable said governments should coordinate across borders to take on companies including Google Inc. and make them pay more tax.

He spoke after Google Chairman Eric Schmidt said he was “very proud” of his company’s structure, which helped it avoid about $2 billion in worldwide income taxes by shifting revenue to a Bermuda shell company. “It’s called capitalism,” Schmidt said.

“It may well be, but it’s certainly not the job of government to accommodate it,” Cable told reporters in London. “Governments have been very much behind the curve. We operate national systems of enforcement in a world where companies operate on a global scale. On behalf of taxpayers, we’ve got to retrieve the situation.”

Cable said he expected the Group of Eight leading industrial economies to work on coordinating tax collection. Britain is in the chair of next year’s meeting. Asked if Starbucks Corp.’s announcement that it had decided to voluntarily pay more tax in the U.K. had put a lid on the issue of avoidance, he said, “absolutely not.”

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