Monday, 24 December 2012


FACEBOOK is under fire after allegations it paid only £200,000 in UK corporation tax, despite earnings of up to £175m.

The social networking site is the latest business in the scandal after Google, Amazon and Starbucks were also exposed for tax avoidance.

Facebook achieved this by channelling a large portion of their sales through its Irish subsidiary.

The media giants also only paid £2.9m overseas revenue from its £800m profit in 2011.

Facebook’s vice president and managing director in Europe, Joanna Shields, defended the company’s actions:  “The reason those companies make those decisions is because of the investment environment and the tax environment.”

Facebook joins a recent group of businesses that have been uncovered for dodging UK corporation tax.

In 2010, eBay attempted to cut its £51m debt by paying only £1m tax on sales of £789m after diverting money through overseas companies.

Ikea paid only £8.1million of corporation tax from £1.2billion earnings in the year 2011.

In November, the Public Accounts Committee saw spokesmen from Amazon, Starbucks and Google grilled by MP’s over the alleged accusations.

Margaret Hodge MP, Chairman of the PAC, said: “We’re not accusing you of being illegal, we are accusing you of being immoral.”

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