Facebook pays no UK tax despite £223m revenues
Social networking site avoids tax bill by processing UK sales in Ireland
FACEBOOK paid no corporation tax in Britain last year, according to its latest accounts, despite estimated revenues of £223m. The social network's tax bill fell from £238,000 in 2011 to zero, while its reported UK income rose by 70%.
Accounts show a pre-tax loss of £2.4 million for Facebook UK on a turnover of £34.6 million, but independent analyst eMarketer says the company is likely to have generated £223 million last year from advertising in the UK.
It funnels the vast majority of its UK income through Ireland, which charges tax at a lower rate.
Commons public accounts committee chairwoman Margaret Hodge has accused Facebook of “deliberate manipulation of accounts”. She said these tactics are a calculated attempt to deprive the British taxpayer of a rightful tax contribution.
"I am getting fed up of this constant stream of stories and little sign of a challenge from HMRC and a strange silence from Government," she said.
Facebook UK has only paid £1 million in corporation tax since opening its London office in 2007 “even though it is estimated to have made over £500 million in sales in that time”, says the Independent.
A spokesman assured the public that the company takes their tax obligations seriously: “Facebook pays all taxes required by UK law and we comply with tax laws in all countries where we operate”. ·