Google's chairman says he is "proud" of the way his company avoids paying taxes.

"It's called capitalism," Eric Schmidt told Bloomberg in a Wednesday article. "We are proudly capitalistic. I'm not confused about this."

"We pay lots of taxes; we pay them in the legally prescribed ways," he said. "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."

Bloomberg reported on Monday that Google avoided paying $2 billion in global income taxes last year by housing profits in Bermuda, which has no corporate income tax. Google already had been paying a 2.4 percent overseas tax rate through tax avoidance strategies, according to a 2010 Bloomberg report. Its overall effective tax rate was 22.2 percent in 2009.

Google could not be reached for comment.

Google's effective U.S. tax rate is unclear. Citizens for Tax Justice did not analyze Google in a 2011 study because Google reports most of its profits as foreign, even though that may not be true.

Other big companies have avoided taxes by shifting revenue abroad. Boeing, DuPont, Capital One and General Electric paid a negative effective U.S. tax rate in 2010, according to Citizens for Tax Justice. Apple paid a total effective tax rate of just 9.8 percent last year, according to The New York Times.

The U.S. government has been struggling to balance its budget; its annual deficit is projected to be $1.1 trillion this year. But taxing companies more is not really on the table. Both the Obama administration and congressional Republicans have proposed cutting the corporate tax rate.

Google is a member of the Silicon Valley Leadership Group's Tax Policy Committee, which advocates for tax reform. The group says on its website that California should "lower overall tax burdens" and give companies "tax-based incentives."

(Hat tip: the Telegraph.)

Earlier on HuffPost:

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  • On-Site Doctors

    I'm not sure if it's an actual perk not to have to leave the office when you're sick, but on-site doctors ensure that this is a reality at Google's Mountain View campus. <a href="" target="_hplink">According to Google's benefits site,</a> physical therapy and chiropractic services are also available.

  • Japanese Toto Toilets

    Is it really any wonder that Googlers have access to some of the most high-tech toilets around? <a href="" target="_hplink">These Japanese johns</a> offer washing and drying of your nether regions as well as the mysterious "wand cleaning." Both the wash water and the seat itself can be warmed or cooled depending on your preference. Want to see what it's like to be a Google employee? <a href="" target="_hplink">On its website,</a> manufacturer Toto lists restaurants around the country where you can have your own luxury toilet experience on one of their Washlets.

  • Endless Lap Pools

    One perk about not working at Google is that Gawker never posts a photo of you swimming <a href="" target="_hplink">in one of the Googleplex's lap pools.</a> The outdoor mini-pools are like water treadmills: a strong current allows the Googler to swim and swim and go nowhere. <a href="" target="_hplink">Luckily, according to How Stuff Works,</a> lifeguards are always on duty in case someone gets in over their head. Google is big on water sports. In August, the company installed a temporary wave pool on campus to celebrate the Google+ team, <a href="" target="_hplink">reported Launch. </a> See a picture of Google co-founder Sergey Brin riding the waves <a href="" target="_hplink">here.</a>

  • Conference Bike

    <a href=",2817,2344010,00.asp" target="_hplink">According to PC Magazine,</a> Google's Conference Bike is used as a team-building exercise for new employees. It has four wheels and five riders who work together to move it around.

  • Free Food

    Google's food program may not be the most creative perk at the company, but it is probably the most valuable to employees. Everyday, Googlers get three full meals and unlimited snacks from the campus' 25 cafeterias totally cost free. <a href="" target="_hplink">According to The Atlantic,</a> the company makes an effort to keep the meals as healthy as possible by putting vegetables in every dish, using small plates and giving healthy items prime real estate in the cafeterias. <a href="" target="_hplink">Google has also developed a creative pricing system</a> for vending machine food (the only edibles that cost money). The more sugar and fat contained in the snacks, the more they cost, which Google hopes will be enough incentive to keep its employees from gaining weight. Image via Flickr: <a href="" target="_hplink">Brett L.</a>

  • Free Haircuts

    Employees who don't have the time or inclination to get haircuts in the real world can get trimmed up at Google for free. <a href="Haircuts just one of Google's employee perks" target="_hplink">According to Reuters,</a> the service is provided by a company called <a href="" target="_hplink">Onsite Haircuts</a> which operates out of mobile homes that travel around cutting the hair of Silicon Valley's tech army. Image via Flickr: <a href="" target="_hplink">Marcin Wichary</a>

  • Ball Pit

    Google has two things in common with McDonald's: an inclination toward primary colors and a ball pit. The Google Chrome ball pit is as you might expect a ball pit filled with plastic balls in the yellow, red, blue and green of the Google designed browser, Chrome. Check out the video above to see employees having too much fun at work.