Schmidt said he is “very proud” of the company’s tax structure, and said that measures to lower its payments were just “capitalism” reports The Telegraph.

“It’s called capitalism,” he said. “We are proudly capitalistic. I’m not confused about this.”

He went on to defend the company’s legitimate tax arrangements. “We pay lots of taxes; we pay them in the legally prescribed ways,” he told Bloomberg. “I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate.”

Documents filed last month show that Britain is Google’s second biggest market and generating $4.1bn for the company last year. In spite of this, the company paid just £6m in corporation tax.

Overall, by channelling its revenues through Bermuda, Google avoided $2bn of global income levies last year.

The tax arrangements of the company add fuel to accusations that multinationals such as Starbucks and Amazon, have been “immorally” minimising their tax bills.