Sunday 31 January 2016

Osborne is the Baldrick of the Tory Party

John Prescott writes:

If you Google the word “gullible” you’ll find a picture of the Chancellor of the Exchequer looking at you.

At the World Economic Forum in Davos, Switzerland – a week-long egofest for billionaires – George Osborne hailed the “major success” of getting Google to pay tax on its 10-year profits of £7.2billion.

If it were any other company, it would have paid 20% corporation tax of £1.5billion. Instead he let it cough up an extra £130million on top of the measly £70million it had already paid.

Compare that to Italy, where Google is being told to pay £113m in tax on profits of £760m. That’s a tax rate of 15% – five times more than what Osborne agreed.

If the Chancellor had followed Italy’s lead the UK taxpayer would get £1BILLION.

That would build more than 4,000 council homes, guarantee a 3% pay rise for every nurse in the UK until the end of this decade or fund the flood defence projects they cancelled.

Even the French are demanding Google pay three times as much tax than Osborne settled for. So why did the internet giant get such a good deal? 

Well, I went online and googled “Tory, Google and links” to see if I could find any clues. 

When the Tories were in ­opposition, Google paid for Cameron to attend their annual conference twice – in 2006 and 2007.

Then in the first two years of the Conservative-led ­coalition, Tory ministers met Google executives 23 times. The Prime Minister saw them three times, Osborne four. 

Then between January 2014 and September 2015, Google met Government ministers 25 times. Google was effectively meeting a Government minister once a month! 

Within six months of coming to power, Osborne was writing joint articles with Google boss Eric Schmidt. It seemed Google had joined the Coalition.

In a way it had... 

Schmidt was made a member of the PM’s Business Advisory Council, and three years ago he attended a tax avoidance summit at No10. A bit like inviting King Herod to a childcare seminar. 

And in 2011, Osborne went to Google’s Zeitgeist conference and excitedly hailed “the impact that you are having – as internet entrepreneurs, innovators, technologists – on the world of government and politics”. 

He wasn’t wrong. Many senior figures have moved between Google and the Tories.

Former Tory leader Michael Howard’s political secretary Rachel Whetstone – a close friend of Cameron – became Google’s spin doctor and policy chief. She just so happened to be married to Cameron’s No 10 director of strategy Steve Hilton.

And Cameron made Google’s former MD of Europe, Joanna Shields, his digital advisor and then a peer so she could become one of his ministers.

Why move to a tax haven when you can cut a deal with HMRC which is championed by the British ­Chancellor in a billionaire Swiss ski resort? Talk about mates’ rates. 

Today is the last day to submit your tax return. So when you’re filling it out, think about how your money is ­subsidising that Google deal. 

When Labour’s Shadow Chancellor John McDonnell demanded a House of Commons statement, the cowardly Osborne sent his junior minister David Gauke to defend the deal. 

He was forced to admit he didn’t know what Google should be paying. 

Now the Treasury Select Committee has opened a formal investigation, the European Commission is clamping down and the EU Competition Commissioner said Osborne’s deal might even be illegal state aid. 

Google should be forced to pay up, just as any hardworking small business must.

Osborne boasts about the Northern Powerhouse, then cuts funding to Northern councils by up to 40%. He brags of a National Living Wage when it’s just a rebranded minimum wage subsidised by tax credit cuts. 

Osborne is the Baldrick of the Tory Party. His “cunning plans” always get exposed as being as daft as his haircut.

He should rip up his sweetheart deal and take a leaf out of the Italians’ book – and make Google an offer they can’t refuse!

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