If you’ve heard about the new “Google Tax” you’re probably wondering what it is and why it’s happening. Google has been fighting this new innovation in other countries for several years, but it’s finally getting some recognition in Germany. The new law requires Google to collect royalties for advertisements in countries where the company’s content is not native. It will also apply to advertisements that are targeted towards Indian users. Ultimately, this means more money for the revenue department.
Google, like many other companies, has a large global user base. They don’t want to pay any extra tax, so they divert their profits from international businesses. It’s not a good practice, but it’s also a way to reduce taxes. Multinational corporations and technology giants have used this strategy to lower their taxes. Games like Clash of Clans and Meta have used this strategy to increase profits in their home countries, where they have a lower tax rate.
The new Google tax is not as bad as some might think. A more accurate name for the new law is the “diverted profits tax.” It’s a form of anti-avoidance tax designed to discourage companies from moving their profits to countries with low or zero tax rates. Google, the world’s largest search engine, has been evading the tax on its overseas profits for several years. In fact, it’s paid only 2.4 percent of its profits in the United Kingdom in the last three years.