° °
  • Firstline - TV3 New Zealand

    Firstline

    Weekdays 6am

  • 3 News - TV3 New Zealand

    3 News

    Nightly 6pm

  • Campbell Live - TV3 New Zealand

    Campbell Live

    Weekdays 7pm

  • 3rd Degree - TV3 New Zealand

    3rd Degree

    Wednesdays 8.30pm

  • The Paul Henry Show - TV3 New Zealand

    The Paul Henry Show

    Weekdays 10.30pm

  • Three 60 - TV3 New Zealand

    Three 60

    Sundays 9.30am

  • The Nation - TV3 New Zealand

    The Nation

    Sat 9:30am / Sun 10am

Facebook, Google not cheating on tax - expert

Friday 30 Nov 2012 9:48 a.m.

Tax treaties are built around

Tax treaties are built around "bricks and mortar" companies, not the internet

Facebook and Google aren't cheating the system by paying tiny tax bills, an international tax expert says.

Labour is blaming the government for allowing the companies to "get away with it" after producing figures showing Facebook's New Zealand arm paid $14,500 tax on revenue of $427,967 last year and Google $109,038 on revenue of $4.4 million.

The party's revenue spokesman, David Clark, says Revenue Minister Peter Dunne is refusing to close loopholes but international tax expert Maurits van den Berg says it's not that simple.

"The future has arrived, we're dealing with intellectual property and it's very mobile," he said on Friday.

"These big multinational intellectual property companies quite likely have minimal or no actual presence in New Zealand - it makes them quite hard to tax."

Mr van den Berg says Facebook and Google aren't guilty of tax evasion, or even tax avoidance.

The problem is that international tax treaties are built around "bricks and mortar" companies which have property and employees in different countries, he said on Radio New Zealand.

"It's easy to tax a multinational company that has a warehouse in New Zealand and employs sales staff but these intellectual property companies are a real challenge for governments."

Mr van den Berg agrees with Mr Dunne, who says New Zealand has to operate under its international tax agreements.

"Intellectual property needs to be sorted out at an international level, and it's going to take years," Mr van den Berg said.

NZN

Others Are Watching

comments powered by Disqus

Trending

>
;