The chief executive of Google has declared he is happy for his company to pay more tax, and called for the existing system to be reformed.

Sundar Pichai told an audience at the World Economic Forum in Davos that the tax system needed to be reformed to address concerns that some companies were not paying their fair share.

Speaking before the French president, Emmanuel Macron, challenged tech giants to pay more tax, Pichai said: “As a company we paid, over the last five years, close to 20% in tax. We are happy to pay a higher amount, whatever the world agrees on as the right framework. It’s not an issue about the amount of tax we pay, as much as how you divide it among various countries.”

A report issued last autumn estimated that European countries had missed out on €5.4bn in tax revenues from Google and Facebook between 2013 and 2015, because the two tech giants had routed revenues through countries with low corporation tax rates.



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Pichai argued that the existing tax system was to blame, as it is based on where a company carries out its research and development.

He pointed out that Google had launched an AI research centre in France this week, which should redress the balance.

“We’re going to be hiring a lot of engineers in France, and we are doing that in Europe. Over time, that normalises the value of tax we pay, as it reflects where you create value,” Pichai said.

The Google chief insisted his company was “open” to any solutions, but argued that global policymakers should take the lead. “We encourage the OECD to actually solve these issues, which would make it much easier for companies to operate.”

In a wide-ranging interview, Pichai also called for world leaders to collectively pledge not to use artificial intelligence systems for warfare.

Pichai said the only way to avoid an arms race in military AI was for countries to work together.

But he also suggested that AI could actually be an “equaliser” between nation states. “Over time people will realise it’s tough to weaponise it because everyone will have the same ability [to fire] back.”

Q&A What is AI? Show Hide Artificial Intelligence has various definitions, but in general it means a program that uses data to build a model of some aspect of the world. This model is then used to make informed decisions and predictions about future events. The technology is used widely, to provide speech and face recognition, language translation, and personal recommendations on music, film and shopping sites. In the future, it could deliver driverless cars, smart personal assistants, and intelligent energy grids. AI has the potential to make organisations more effective and efficient, but the technology raises serious issues of ethics, governance, privacy and law.

Macron asked in an address at Davos: “How can I say to a tech startup that you are going to be paying tax when a big multinational does not?”

He called for international cooperation on tax to avoid a race to the bottom that would lead to lower funding of health, education and policies designed to promote social cohesion.

Technology firms that were destined to be responsible for millions of people losing their jobs through automation should help pay for retraining programmes, he added.