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MP calls on taxman to 'toughen up' over Google's creative accounting

MP calls on taxman to 'toughen up' and probe Google's alleged creative accounting
HMRC needs to 'more assertive' with Google over tax

Google should be the subject of a full investigation from Her Majesty's Revenue & Customs (HMRC) over allegations of tax avoidance, according to the MP leading the fight against the company's practices.

Margaret Hodge MP, told the BBC that it was "astonishing" the taxman hadn't probed "the complete mismatch between the company's supposed structure and the substance of its activities."

The web giant has been under fire in recent months for billing for its sales in the relative tax haven of Ireland when the vast majority of deals for the ad sales are supposedly being struck British soil.

Google has denied any illegality, but Ms Hodge, who is also the chair of the Public Account Committee, said HMRC "wasn't being tough enough on the way Google has chosen to interpret the rules" and needed to be "more assertive."

Google: You make the rules

Despite only paying £6m in corporation tax last year, Google says it has abided by the rules as they currently and exist and has blamed "the politicians" for making the rules.

A Google spokesman said: "It's clear that the Public Accounts Committee wants to see international companies paying more tax where their customers are located, but that's not how the rules operate today.

"We welcome the call to make the current system simpler and more transparent."

Google isn't the only tech giant under fire from the PAC. Amazon is also facing allegations of tax avoidance on sales made in the UK.