The tech giants, like Google and Apple, are giant corporations like any other, and as such have all developed insanely complicated tax strategies designed to save money. And because Google, Apple, and the rest are such visible behemoths, they've been taking heat in Europe and the U.S. for avoiding taxes. Now it appears that Google saved around $2 billion in 2011 after shifting $9.8 billion in revenue to Bermuda, which has no corporate income tax.That amounts to around 80 percent of Google's total pretax profit that year, according to Bloomberg. That move meant Google's effective tax rate was only 21 percent last year, much lower than the average U.S. and state statutory rate of about 39 percent.The move itself is a complicated money-funneling technique known as a Double Irish with a Dutch Sandwich. Google has a subsidiary in Ireland that collects most of its European revenue, and that firm pays royalties to another Irish subsidiary which, for the purpose of taxes, is legally based in Bermuda. Google then funnels the Irish money through a third subsidiary in the Netherlands into Bermuda proper. Bloomberg reported that the Dutch company has no employees, and its "payments to the Bermuda entity last year were up 81 percent to $9.8 billion from $5.4 billion in 2008. Google’s overseas sales have increased at about the same rate."The move is legal, but that hasn't pacified government officials. Multinational corporations have come under intense scrutiny in the U.K., Europe, and Australia this year as governments struggle with debt. France recently handed Google a tax bill of over $2 billion, Starbucks has allegedly only paid £8.6 million to the British government in taxes since 1998 on over three billion pounds of revenue, and in SEC filing Apple said it had only held aside two percent of foreign earnings for taxes.The tax debate will likely run on forever, and I'm not going to try to pick sides here. But signs are mounting that governments are taking tax dodges more and more seriously, which may mean the Double Irishes and the like may not exist for much longer. The question for we non-corporations is then whether or not consumers will have to pay for the elimination of multinationals' Dutch Sandwiches.Follow Derek Mead on Twitter: @derektmead
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