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Nearly £1 Billion in Revenue But Only £5 Million in Tax…

I’ve reported before on this blog about how large companies operating in the UK are making billions but paying barely any tax.

Now it is the turn of Facebook, who in the last year saw their UK revenue jump from £210 million to £850 million.

Now I’m no maths teacher, but that is nearly 1 billion pounds sterling that Facebook are making right here on British shores, and which you would expect to come with a hefty tax bill.

Take your average contractor for example. If they were bringing in over £800 million pounds a year then I’m sure they would expect to pay quite a significant amount of tax to the inland revenue, even if they had a good contractor accountant on their side.

However, that doesn’t appear to be true for Facebook, as reports are claiming they are only being hit up for £5 million in taxes, despite the fact they are pulling in close to a Billion from UK customers.

Why are Facebook doing so well anyway, because as we all know, it’s a free social media site? The answer is advertising, and my insider sources are saying that in the past year they have been selling ad space to big UK businesses who don’t mind paying out a lot of cash.

Not bad money if you can get it, and it seems like Facebook are getting plenty of it, with some pundits predicting they will join the ranks of Google, Apple, and Microsoft by earning over £1 billion pounds in the UK.

Just like those companies they also have a good accountant working for them no doubt. In fact, it wouldn’t surprise me if Facebook pay more for accountants than they do tax, but who knows for sure.

As far as I’m concerned the good people over at Facebook are doing everything legal and above board and will continue to do so, unless a court of law proves otherwise.

That hasn’t stopped some organisations flinging accusations at the UK branch of Facebook though, with the chief executive from the Tax Justice Network having this to say – “The UK approach to these tech companies doesn’t deliver the results the public expect. Parliament has already given the Treasury the power to require a different level of tax transparency. For reasons we do not understand the government has chosen not to do that.”

A spokesperson for Facebook has responded to the criticism by commenting that a “company restructure” has just been actioned and they hope it will “provide greater transparency on our operations in London and be easier for people to understand.”

Unfortunately, the mood among the general public is less than favourable, with one hard working tax payer saying, “let’s all hold our tax until Facebook pays 10 billion in back taxes.”

That isn’t going to happen of course, because if there is one thing the government expects from all workers, whether it is an employee, self employed business owner, freelancer, or contractor, well, they expect you to pay your taxes.

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