Facebook pays just £4,327 corporation tax in 2014.

Graham_Devon

Reignites the debate.

The average worker on 26k paid £5,392 in tax in the same year.

The company made a £28.5m loss in the UK in the year. However, it paid out bonuses to UK staff amounting to £35.4m in the same year.

The average bonus per employee amounts to over 20x the corporation tax paid.

Facebook in response state that they are compliant with UK tax law. They also state their employees pay taxes in the UK (as if to somehow suggest this is a backdoor tax payment from facebook).

They probably are within UK tax law - but it's a pretty stupid situation for us to be in.

http://www.bbc.co.uk/news/business-34504474

michaels

If Facebook want to come to the UK and waste their money making a loss by selling us stuff at less than the cost of production then surely that is in our interest (unless it is some sort of 'intellectual' dumping exercise which is crowding out local production)?

Mistermeaner

and what? it should pay its people less so they pay less tax so it can pay more corporation tax?

martinsurrey

Graham_Devon wrote: »

Reignites the debate.

The average worker on 26k paid £5,392 in tax in the same year.

The company made a £28.5m loss in the UK in the year. However, it paid out bonuses to UK staff amounting to £35.4m in the same year.

The average bonus per employee amounts to over 20x the corporation tax paid.

Facebook in response state that they are compliant with UK tax law. They also state their employees pay taxes in the UK (as if to somehow suggest this is a backdoor tax payment from facebook).

They probably are within UK tax law - but it's a pretty stupid situation for us to be in.

http://www.bbc.co.uk/news/business-34504474

My guess is that Facebook, don't need to employ 361 people in the UK, they could move them to Switzerland, and they and their employees would pay a lot less payroll taxes. The UK loses 362 jobs and the related payroll taxes.

How do you think we should fix it?

michaels

Mistermeaner wrote: »

and what? it should pay its people less so they pay less tax so it can pay more corporation tax?

Yup, it would definitely be better if they paid corporation tax at 20% than their employees paid income tax at 50%.....what?

martinsurrey

michaels wrote: »

Yup, it would definitely be better if they paid corporation tax at 20% than their employees paid income tax at 50%.....what?

nooooo, you're forgetting employer NI

for every £100 they pay to an additional rate tax payer, the employee pays £52.00 and Facebook pays £13.80 for a total employment tax take of £65.80

the £113.80 they spend reduces their corp tax paid by £22.76

So by paying bonuses instead of making a profit the treasury gets £43.04 EXTRA for every £100 of bonus they give.

so how is it a bad idea?

Carl31

I hate these stupid articles, so short sighted

wotsthat

This is the BBC at their best...

'Social network giant Facebook paid just £4,327' i.e. impartially telling the reader it's not enough

'The latest revelations' err...they've just submitted their accounts at Companies House. Hardly a revelation.

'Facebook's UK corporation tax bill was less than the tax the average UK employee paid on their salary' - if in doubt compare to an average; preferably a nurse.

If it wasn't for Eastenders keeping thick people off the streets I'd say the BBC represented poor value.

Thrugelmir

Carl31 wrote: »

I hate these stupid articles, so short sighted

There's a debate to be had. Unfortunately the press coverage tends to be poorly informed. As a result the companies involved can easily deflect the criticism.

martinsurrey

Thrugelmir wrote: »

There's a debate to be had. Unfortunately the press coverage tends to be poorly informed. As a result the companies involved can easily deflect the criticism.

can someone detail out, what the problem in this case is, and how it should be made better?

Carl31

martinsurrey wrote: »

can someone detail out, what the problem in this case is, and how it should be made better?

I think the public are made to be upset that a multinational corporation the size of Facebook has ONLY paid £4k in Corporation tax, ignoring the income tax paid by their staff of c£35m in bonus payments, plus any NI on the remuneration from both sides, plus the fact they provide employment and other economic benefits etc...