The Facebook tax row will not go away. Figures show that the social media company paid just over £4,000 in corporation tax last year. It is a number that, at least to me, appears to be mysteriously low.
In Facebook most recent company house filing the company showed that it made a pre tax loss of £28million last year. Still, the company has 362 UK staff who were paid £35million pound in share bonuses, which amounts to £96,000 per employee. What this means is that Facebook’s UK corporation tax bill was less than the tax their average UK employee paid on their salary.
The average salary is £26,500 on which employees pay a total of £5,392.80 in income tax and national insurance contributions. Facebook as a company are paying less. These are startling figures from a company that recorded global fourth quarter profits of £462m, an increase of 34% on the year prior. Total profits stood at $2.9billion and advertising revenue amounted to $3.59billion, a 53% growth. Yet their corporation tax was a measly £4,327.
This is the very issue that Labour leader Jeremy Corbyn claims he wants to tackle in a bid to become Prime Minister. Instead of David Cameron’s and the Conservatives age of austerity, where public services are cut in a bid to tackle the country’s financial deficit, Corbyn believes that the poor should not be held accountable for the banking crisis. Corbyn believes that big businesses should be paying the full amount of tax, instead of the dodging and leal loopholes which have infecting the system.