We need to take action on the tax shirking oligarchs of the internet

by Dan McCurry

Rather like in ancient Rome or the end of the Soviet Union, the sudden expansion of the internet has produced a small number of oligarchs controlling a huge amount of industry.

It was only a matter of time before the moral and ethical questions began to pile up. Initially, they destroyed traditional industry with little or no objection from policy makers or the public, as this was a new and super-efficient way to market goods and services, and we must not stand in the way of progress.

But then the abuse allegations began to mount. Google is accused of using its search engine to guide traffic towards its own services rather than that of its rivals. Amazon is accused of using its dominance to bully publishers. Apple dominates downloads of music and other digital content, creating questions on the state of competition.

Then we discovered that Google and Amazon were using their ability to cross borders unchecked as a tool to avoid tax, and therefore have an unfair advantage over the existing competition.

In fairness, the multinationals invented the rules that the internet giants appear to be feasting on. Starbucks claims to make no profit due to the huge amounts of royalties it has to pay to its subsidiary in low-tax Luxembourg. The royalties are for the right to use its own logo.

Maybe Starbucks should drop serving coffees and stick to its core business of charging customers for a napkin with the logo on. The customer can sit down at a table, with their logo embossed napkin and stroke it for 20 minutes before leaving? Their position is so absurd it’s no wonder that after a modicum of public scrutiny they have volunteered to pay more tax.

Google has a sign above the front door of its head office that reads, “don’t be evil!” It is a motto created when the company first took off so spectacularly. They wanted to remind themselves not to become greedy and self-interested, like so many others before them. However, I suggest they change their sign to “pay your taxes!”

Meanwhile the Tories want to jump on the bandwagon. George Osborne is going to do a proper crackdown on people who avoid taxation. Maybe in PMQs Ed Miliband might ask David Cameron why he hired Philip Green as a government adviser during the controversy of Green’s £1billion dividend paid to his wife in Monaco.

It’s difficult these days to find someone who hasn’t been ripped off on eBay.

It’s a fantastic website for connecting sellers to buyers, but it seems largely un-policed by the company. In fairness, eBay have responded to law suits by branded manufacturers such as Cartier, and have taken action against the sellers of fake goods, but their actions seem to be at a minimum and only apparently in response to legal action.

eBay argue that they are providers of the venue and it’s not for them to police the venue. But it all sounds very familiar. Like other internet oligarchs, they started out intending to not be evil, but run the risk of being yet another company that ended up avoiding any responsibility while grabbing the maximum amount of profit they possibly can.

The piecemeal anti-trust law suits against the oligarchs have resulted in piecemeal results and will continue to do so. We need to establish an overarching vision of what to do about them. Should they be broken up to allow competition to flourish? Should international laws be created to stop them playing one country off against another?

The internet is maturing and the time has come to start talking about what we want to deliver to our kids. A small bunch of monopolies, or a diverse set of providers? A sense of purpose or a sense of themselves? A responsible code of management, or an arrogant and distant tax exile?

There’s nothing to stop us making this change. We only have to decide to do it.

Dan McCurry is a Labour activist whose photographic and film blog is here.


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5 Responses to “We need to take action on the tax shirking oligarchs of the internet”

  1. swatantra says:

    Yes we do. Regulate Regulate Regulate. And Tax.

  2. John Dore says:

    Drivel.

  3. You only have to regulate once.

  4. ad says:

    I want these people to give the government more money. Why does it matter if they follow these pettifogging laws!

  5. swatantra says:

    Then, why do they have to bring in a Finace Bill, or Education Bill, or Crime Bill practically every year?
    To close up the loop holes.

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