Starting from the year 2020, Google is going to put an end to the practice of using some controversial Irish and Dutch loopholes in order to save a huge amount of money in taxes on foreign ad revenue. This was stated by the report from Reuters. These tax loopholes were called the “Double Irish” and “Dutch Sandwich” loopholes and as reported Google is going to stop taking advantage of it in the coming year.
These Irish and Dutch tax loopholes allowed the company of google as well as various other companies to move their money from Ireland to the Netherlands and Bermuda, and this saved them billions of dollars from taxes in the process. Since Bermuda has no corporate income tax then it made the whole sum to be the lucrative final stop to report income.
The practice allowed them to delay the taxpaying to the government of the United States on the money that they are making overseas. Apart from this, the practice also lets them save a lot of money on overseas taxes. The move of banning this activity came as a regulation because it was affecting the economy of the United States as well as Ireland.
A Google spokesperson revealed that they have not simplified their corporate structure. But they will be going to license their IP from the United States and not Bermuda. He continued by saying that “our global effective tax rate has been over 23%, with more than 80% of that tax due in the US.”
