Rupert Murdoch Attacks Google Over U.K. Tax as Cameron Defends Deal

News Corp. chairman lets rip on Twitter, accusing Google of utilizing lax tax laws and deploying “brilliant lobbying”.

Key Speakers At The Milken Institute Global Conference
Photographer: Jonathan Alcorn/Bloomberg

Rupert Murdoch, whose News Corp. paid no U.K. net tax at all between 1987 and 1999, attacked Google parent Alphabet Inc.'s tax deal with the U.K.

"Google et al broke no tax laws,'' Murdoch wrote on Twitter. "Now paying token amounts for p r purposes. Won't work. Need strong new laws to pay like the rest of us.''

He was referring to Alphabet's agreement to pay 130 million pounds ($185 million) in taxes dating back to 2005.

Murdoch's attitude to low tax rates in 2016 put contrasts with data on his company's behavior in the past. A 1999 report by The Economist showed Murdoch's own company, News Corp., had paid a tax rate of 6 percent over the previous four years. In the U.K., it had paid no net tax at all on 1.4 billion pounds of profits made since 1987.

Lobbying Protest

Hours before Murdoch's tweets, British Prime Minister David Cameron was forced to defend his government's handling of Google's taxes during his weekly question-and-answer session in the House of Commons. He replied that the money raised was tax the company hadn't been paying under a previous Labour government.

Murdoch, whose company has 23 tax haven subsidiaries, according to a 2015 report by Citizens For Tax Justice, including three in the Cayman Islands, six in Hong Kong and four in Luxembourg, attacked tech companies for using such countries. 

"Global tech companies making enormous profits most places, funnelling $$ thru tax havens,'' he tweeted. "Unless stopped will ruin local businesses who pay.''

The billionaire, whose executives visited Cameron 26 times in his first 14 months in office, also complained that Google was too effective at lobbying.

"Tech tax breaks facilitated by politicians easily awed by Valley ambassadors like Google chairman Schmidt eg, posh boys in Downing St,'' Murdoch tweeted. He then added: "Google has cleverly planted dozens of their people in White House, Downing St, other governments. Most brilliant new lobbying effort yet.''

Google declined to comment.

Cameron was attacked in 2011 for his closeness to Murdoch, after the phone-hacking scandal exploded over News Corp. He had hired former News Of The World editor Andy Coulson, who was later jailed, as his communications chief. Coulson's co-defendant Rebekah Brooks, who was acquitted and has since returned to News Corp., is a ferocious networker. Her 2009 wedding was attended by both Cameron and then Prime Minister Gordon Brown.

Bloomberg LP, the parent of Bloomberg News, competes with News Corp. units in providing financial news and information.

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