Havens and sources

The Hindu : Business / Economy : Havens and sources

• Technology multinational corporations should either share their gross profits between the tax havens and the relevant resident or source country, or ensure that at least 10 per cent of the gross profit is paid to the relevant resident or source country.
• suggests Cynthia Obiri, Doctorate of Finance Student in the Swiss Management Centre.
• An example cited in Obiri's recent pape
• about how Google Ireland Ltd's 2009 gross profit of Euro 5.5 billion was subjected to an "administrative expense" of Euro 5.467 billion paid to its Bermuda headquarters for the right to operate, which reduced its operating profit to a measly Euro 45 million.
• the global Internet giant simply uses national tax differences to its advantage in the global tax system
• when technology companies sell their intellectual property to a tax haven-resident controlled foreign holding (CFH) company, the result is serious economic impairment suffered by countries such as Ireland.
• the cost of using the IP, i.e., the amount charged by its Bermuda CFH must be half of its gross profits."