Tag Archives: Corporation Tax

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Facebook paid no corporation tax in Britain last year, according to its latest accounts, despite taking an estimated £223m share of the digital advertising market.
The social network’s tax bill fell from £238,000 in 2011 to zero, while its reported UK income rose by 70%.
….In common with fellow American technology leaders Google and Apple, Facebook funnels the vast majority of its income from advertisers targeting its 33 million British users through Ireland.
France is pushing for Europe to adopt a new corporation tax regime which would see multinationals such as Google and Facebook regulated and taxed in the countries where customers use their websites.
Fleur Pellerin, the French digital economy minister, is expected to push for the reforms at a summit of European leaders scheduled for the end of October.

 

 

They’re on to us, aren’t they?

Facebook’s UK corporation tax bill: £0 (The Guardian)

Poster: IDA

ftNO.

Should the Commission find cause for concern, it will open a formal investigation and start a process that could force the states to recoup all the lost revenues from any unlawful sweetheart deals.

 

Sweetheart deals?

A U.S. Senate committee recently singled out Ireland for acting as a conduit for Apple’s earnings so it could sidestep large tax payments around the world. The report claimed Dublin allowed Apple to apply a corporation tax of 2 percent or less, well short of the usual 12.5 percent rate.

 

RUN!

Brussels Probe Multinationals Tax Returns (CNBC)

Previously:Home And Away

Low Rates And Not Too Many Questions

They’re On To Us

Not Far From The Tree

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A tax protest yesterday evening at the Apple Store on London’s Regent Street.

Via: 100 Acts, Tiernan Douieb

financial-timesJust this.

“The tax avoidance schemes are so complex it elevates the position of accountants, causing young talented people to gravitate to these jobs rather than becoming engineers or moving into positions that build innovation,” says Jim Stewart, associate professor of finance at Trinity College Dublin.

“It is also dangerous. With the stroke of a pen in another country, companies located in Ireland relying on tax incentives could choose to relocate.”

And Ireland’s success in attracting investment and its use of fiscal incentives is less popular abroad.

Nicolas Sarkozy, the former French president, tried to make an increase in Ireland’s corporate tax rate a condition of the country’s €67.5bn international bail out in 2010. Dublin stood firm against Paris, but criticism is intensifying amid evidence of multinationals using increasingly complex tax avoidance strategies to avoid even paying the 12.5 per cent rate in Ireland

Last year a US Senate committee pinpointed three Microsoft subsidiaries in Ireland as playing a key role in an “aggressive” global tax structure aimed at saving itself billions of dollars in US tax. In 2011, the structure saved the company $2.43bn in US taxes. Google has also been widely criticised for using legal tax avoidance strategies, dubbed the “Double Irish” and the “Dutch sandwich” by the accountants who devise them.

John Christensen, director of the London-based Tax Justice Network, says loopholes in Irish tax law enable companies to book profits at near-zero tax rates. “Ireland’s membership of the EU means that many countries that apply withholding taxes on payments to tax havens treat Ireland as an ‘onshore’ country. These factors make Ireland a useful conduit for tax avoidance,” he says.

Michael Noonan, Ireland’s finance minister, rejects the accusation that Ireland is a tax haven and points out that multinationals employ thousands of people in real business activities. “It is America’s tax code that allows for this tax planning,” he told parliament recently, referring to the system that allows US multinationals to pay their tax in Ireland, not the US.

Privately, Dublin is concerned about the Organisation for Economic Co-operation and Development’s call for countries to catch companies dodging corporate tax.

 

Left wing rag.

Great tax race: Ireland’s policies aid business more than public (Jamie Smyth, Financial Times)


 

David Murphy , RTE business correspondent writes:

The Irish are slipping into bad company. Tax on profits is 12.5% in Ireland. There are limited write-offs which allow companies to reduce their tax bills to an average effective tax rate of 11.9%, says Enterprise Minister Richard Bruton.

But some US multinationals are paying far lower rates. The reason these companies can build such aggressive tax avoidance strategies is because they exploit agreements between Ireland and other countries

…The authorities here are trying to convince other countries that Ireland is a low tax environment – not a tax haven. It is an important distinction. If all the US multinationals were paying 12.5% corporation tax there would not be a problem. But they are not.

The unanswered question is whether closing the loophole could result in some US multinationals quitting Ireland. If some did leave, it would mean the constant refrain that they came to Ireland because of our “young educated workforce” is hokum.

Oh.

Why Ireland Cannot Allow Multinationals Exploit Tax System (David Murphy, RTE)

Previously: How Google’s ‘Double Irish’ Tax Scheme Works

The Double Irish Arrangement?

 (Pic: Bloomberg)