Social Network Giant Facebook Slammed for Paying Only $5 Million in UK Tax
10 October 2016
Social network giant Facebook has been slammed for paying only £4.1 million in tax in the United Kingdom (UK). Facebook, which has headquarters in Menlo Park, California, United States, has its UK headquarters in London. It has been reported Facebook received an £11.3 million tax credit from the British tax authorities, offsetting its 2015 tax bill.
The amount of tax Facebook pays in the UK has often been steeped in controversy. In 2014 the social network paid only £4,327 on UK earnings, causing outrage in the British press. While its 2015 tax bill of £4.1 million is significantly more than that of 2014, this amount has also been viewed with suspicion by those that suspect Facebook does not pay enough tax.
Facebook generated £14.44 billion globally in 2015 and forecasts suggest that it will generate $18.77 billion in 2016. The tax credit Facebook received in the UK was based on the country’s tax rules relating to employee bonus programs. Its 2015 UK revenue was reported as being £210.7 million – an increase from £104.9 million in 2014.
"Facebook U.K.'s accounts show specific issues, but point also to the real problem: that major multinational companies appear to be able to pick and choose, unlike the rest of us, where and how much tax they will pay," explained the Tax Justice Network, a coalition of “researchers and activists focused on the harmful impacts of tax avoidance, tax competition and tax havens” in a statement.
Facebook employees 854 staff in the UK.
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