Google's tax deal still shrouded in a cloak of confidentiality

Google executives Tom Hutchinson and Matt Brittin were questioned by MPs. Credit: PA/HoC

Today we learned that Google won't be paying the "Google Tax."

The Chancellor's Diverted Profits Tax was dreamed-up with the intention of penalising multinationals who play fast and loose with the tax system with a punitive 25% tax on their profits.

The tax was announced in last March's Budget and won its moniker after some mischievous briefings from Treasury officials.

So if Google isn't paying the Diverted Profits Tax, can we assume that's because the company's tax affairs are now ship-shape and uncontroversial?

That feels like a leap of faith.

The settlement between HM Revenue & Customs (HMRC) and Google is still shrouded in a cloak of confidentiality.

We still don't know how HMRC arrived at £130 million.

We now know that £18 million was a payment for interest foregone.

We now know Google was not fined by HMRC despite filing accounts that were inaccurate for ten consecutive years. HMRC tells us it wanted to impose a penalty but couldn't prove Google took "insufficient care."

Google says it plays by the rules, HMRC seems satisfied, the trouble is MPs don't seem to believe that HMRC is competent.

"We do not get outmanoeuvred" exclaimed Dame Lin Homer, the chief executive of HMRC. Hmm. The problem is not so much that we're unconvinced, it's that we're still in the dark.

Google set out to defend its position and did just that, although one curve ball did cause the President of Google's European operations some considerable embarrassment.

When Matt Brittin was asked how much he earned (wholly irrelevant to the issue of corporation tax but definitely interesting) he claimed not to know.

Google has since confirmed he has no intention of disclosing his salary.

The mystery continues.