Google’s approach to tax beats Starbucks’ hands down

Just how do you calibrate morality?

Starbucks and Google have faced a great deal of criticism over their taxes, but while earlier this year Starbucks caved and made a “voluntary” offering on the altar of public opinion, Google has just come out on a very defensive wicket. Speaking on BBC Radio 4’s World at One, Google’s Eric Schmidt pointed out that the company’s tax affairs “fully comply with the law”:

Of course that omits the fact that we also hire more than 2,000 employees and are investing heavily in Britain.

Britain has been a very good market for us. We empower literally billions of pounds of start-ups through our advertising network and so forth. And we’re a key part of the electronic commerce expansion of Britain which is driving a lot of economic growth for the country.

So from our perspective I think… you have to look at it in totality. You’re describing the way taxes work globally. And the fact of the matter is these are the way taxes are done globally. The same is true for British firms operating in the US, for example.

I think the most important thing to say about our taxes is that we fully comply with the law and obviously, should the law change, we’ll comply with that as well.

Morality is hard to calibrate – and Schmidt makes a good point: what amounts to vague public distaste over large sums of money shouldn’t be allowed to confuse economic thinking.