Facebook's massive tax bill in the UK

Lloyd Doyle
October 12, 2018

Facebook also received £8.4m in tax credits from granting its employees shares in the company, meaning that its net tax bill will be £7.4m.

Accounts filed at Companies House show that Facebook UK Ltd made pretax profits of £62.7m on sales of £1.27bn in 2017. The tax bill is more than three times the £5.1m that Facebook paid in 2016, but it works out at just 1% of its total sales. Facebook, one of the world's biggest businesses, generated global revenue of more than £30 billion a year ago and is valued at nearly £350 billion.

Margaret Hodge, the Labour MP who has led campaigns against tax avoidance, said it was "absolutely outrageous" how little tax Facebook was paying in the UK.

There's always a lot of outrage whenever it's revealed how much tax big companies are paying, generally because it looks as though they're paying an absolute pittance when compared to the rest of their income.

Conservative MP Damian Collins, chairman of the Digital, Culture, Media and Sport Select Committee, said the firm should pay more tax to reflect "the value of their business in the UK".

It emerged earlier today that Facebook had tripled its United Kingdom tax bill for 2017 to £15.8m, while City A.M. revealed last week that Airbnb had paid just shy of £600,000 in corporate tax past year.

Large tech firms have come under scrutiny in recent years regarding the level of tax they pay in the United Kingdom and mainland Europe.

At the Conservative Party conference last week, Chancellor Philip Hammond threatened internet giants with a new digital services tax to ensure they pay their fair share of the cost of public services. "Large companies, like any other taxpayers, must pay the tax that is due and we do not settle for less". "If we can not reach agreement, the United Kingdom will go it alone with a digital services tax of its own.".

The country, which it says is its biggest engineering operation outside of the USA, is also planning to double its office space in London by 2022. The tax charge is calculated on this pre-tax profits.

Other reports by Iphone Fresh

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