Facebook is probably paying less tax than an average person
As compared the average worker, Facebook has paid £1,000 less in tax to the British Government in 2014.
Despite its parent company in the US expanding profits to £2.9bn, and employee bonuses doubled to £35m, the giant social media company testified a loss of £28.4m in the UK last year.
Also despite its described revenue doubling to just under £105m from £49.8m, this loss has allowed Facebook UK Ltd to minimise its corporate tax bill for the year to only £4,327.
A worker making an average British salary of £26,500 would have paid £5,393 as combined national insurance and income tax in the same year, which is around £1,000 more than Facebook. There was a loss in its accounts which resulted in the soaring cost of wages and welfares for its 362 British staff, who received share-based benefits of £35.4m, on top of an average basic wage of £112,718.
Over the low level of tax it pays each year, the tax figure is likely to increase pressure on Facebook UK. In 2013 after posting a loss in its annual accounts, Facebook UK incurred a corporation tax charge of only £3,169, and received a credit of £182,000.
Its tax bill prompted Margaret Hodge, then chair of the Commons Public Accounts Committee, to say Facebook appeared to be “using elaborate corporate structures and artificial devices for no purpose other than to avoid tax”.
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