Facebook condemned over tax avoidance

Turnover is up but tax take is down at facebook
Turnover is up but tax take is down at facebook

By Charles Maggs

Facebook has been branded the 'unsocial network' after it paid corporation tax of just £238,300 last year despite a declared turnover of over £20 million.

This is a decrease in tax paid of almost £200,000 on the previous year despite profits rising - while the average wage among its 90 London employees was £274,000.

Labour MP John Mann condemned the company's actions as "disingenuous and immoral".


"They benefit enormously from the country's internet infrastructure but do nothing to fund it. It's like driving a car with no tax. We would stand for it on our roads so why stand for it on the net?" he told the Independent.

Facebook's shares have declined rapidly since the company began floating on the New York stock exchange last year, falling from $38 a share on their opening day to less than $20 today.

It's understood that the company managed to pay such a small amount by diverting its UK sales through its Irish operation, where corporation tax is just 11%.

The revelation came just hours after David Cameron pledged to cut taxes for the wealthiest so they don't "go off to live in Geneva".

"We promised that those with the broadest shoulders would bear the biggest burden and with us, the rich will pay a greater share of tax in every year of this parliament than in any one of the 13 years under Labour," he told Conservative party members in his conference speech in Birmingham yesterday.

Facebook has continued to grow and now has over a billion users worldwide, but it isn't the only internet giant to avoid paying its full dues to the treasury.

Amazon, which sells one in four of all books bought in the UK, pays no corporation tax in Britain because its entire European operation is based in Luxembourg.

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