First Apple, then Google and now Facebook.
Like its Silicon Valley brethren before it, the social networking behemoth now finds its tax practices in the spotlight.
In 2014, despite having $1 billion in sales in the United Kingdom, Facebook paid just $6,000 in taxes there, the Sunday Times reported. Globally in 2015, the Menlo Park company paid just $123 million in taxes on foreign profits of $3.4 billion, an effective tax rate of just 3.6 precent, according to the report.
The regular tax rate on larger corporations in the UK is 21 percent, noted the International Business Times. Facebook was able to reduce its tax bill in the UK, at least, by paying its employees company shares and by shifting profits to the Cayman Islands, a notorious tax haven, the Sunday Times reported. The UK s Revenue & Customs office has been scrutinizing Facebook s tax records from 2010 to 2014.
Last week, the European Union announced it would investigate a deal Google reached with the UK to pay $186 million in back taxes after the Scottish National Party charged that it was unclear how the agreement was reached or whether it amounted to illegitimate state aid to the search giant. Meanwhile, Italy accused Google of avoiding 300 million in taxes there between 2008 and 2013.
A report last month by Barron s indicated that Apple may owe up to $8 billion in back taxes in Europe. The company s tax practices in the continent have been under scrutiny since 2014 as part of a larger investigation into corporate tax avoidance.
Photo: A logo created from pictures of Facebook users is on display at the company s data center in Sweden. (Jonathan Nackstrand / AFP/Getty Images)
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