Search and advertising giant Google moved about $23 billion (19.9 billion euros) to tax haven Bermuda in 2017. A report from Reuters suggests that the company did it through a Dutch shell company.
Google’s filing on Dec. 21 with the Dutch Chamber of Commerce has made this information public. This has been done as a part of the arrangement to reduce the foreign tax bill.
It’s worth noting that the amount Google legally channeled via Google Netherlands Holdings BV in 2017 was 4 billion euros more than it moved in 2016.
Google uses its subsidiary in the Netherlands to move earnings from foreign royalties to Bermuda-based Google Irelands Holdings; companies in Bermuda pay no income tax.
“We pay all of the taxes due and comply with the tax laws in every country we operate in around the world,” Google said in a statement.
The tax strategy that Google has used here is called “Double Irish, Dutch Sandwich.” This legal tactic lets the companies like Google and Apple reduce their tax burdens to a great extent.
It’s worth noting that the U.S. has lowered its corporate tax rate to 21% in order to prevent corporations from moving their profits to tax havens.