Facebook paid £4,327 corporation tax in the UK in 2014 • Hacker News Board

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#291

Post by forgotpwtomain » Mon, Oct 12, 2015, 2:55 PM UTC

scanr wrote: post #217

tomelders wrote: post #173

Earlier quoted context omitted.

I utterly reject this argument > 362 Facebook staff on an average salary of say £65,000 will contribute at least £7,230,696.60 in taxes and NI to HMRC. Let's also not pretend that £65,000 is the average salary at Facebook UK, it's likely much higher. First of all, that's Facebook employees paying tax. Not Facebook. That's their money that they are taxed on and they pay it. Secondly, no one is asking for Facebook to p…

> First of all, that's Facebook employees paying tax. Not Facebook. That's their money that they are taxed on and they pay it. I'm reasonably confident that HMRC is entirely happy with corporations choosing to pay their staff more (and have those salaries taxed appropriately) rather than paying their employees less and paying corporation tax on the profits.

But their employees get more isn't in the picture here - they just need to pay competitively with other British companies, whereas all the British companies that want similar talent but are not multi-national are at a distinct disadvantage, since they cannot recoup from avoiding the corporate taxes.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#292

Post by brandonmenc » Mon, Oct 12, 2015, 2:57 PM UTC

phlo wrote: post #273

jkahn wrote: post #12

Global companies offshoring profits and not paying enough tax (in the eyes of many countries) was a hot topic at the last G20 summit in Brisbane. This isn't limited to Facebook, as the article explains. The issue and background here is that when large companies operate globally, each country has its own local subsidiary, owned by the global entity. Money is made in each country by selling goods or services. How are t…

Stories like this make me question if corporate tax even makes sense. However well designed, a tax code with today's complexities is going to have holes. If a savings of even one per mill may mean millions, corporations are going to spend insane amounts of money to hire the best experts to use every last loophole. Why don't we cut down everything to a couple of manageable groups that can be tightened down? I think th…

> Why aren't tax systems as simple as that?

cruft + tax payers writing law + tax collectors writing law

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#293

Post by refurb » Mon, Oct 12, 2015, 2:57 PM UTC

Marazan wrote: post #268

refurb wrote: post #241

Earlier quoted context omitted.

I take it you're equating tax optimization with denying someone their civil rights?

No, what they are doing is pointing out that just because something is legal does not make it moral.

Moral to who? Are you suggesting we legislate morality? I'd prefer not to go down that path (again).

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#294

Post by jkot » Mon, Oct 12, 2015, 2:58 PM UTC

lagadu wrote: post #280

jkot wrote: post #177

Earlier quoted context omitted.

That is just bullshit. Why books or "revenues from artistic works" has 10% but oil 50% VAT? Most people need heating oil more than paintings.

It's a matter of social policy. If you want to encourage more artistry one of the available ways is reducing taxes on it. If someone is against it they're most welcome to vote against it.

So reduced VAT is not for 'essential' stuff.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#295

Post by guard-of-terra » Mon, Oct 12, 2015, 2:59 PM UTC

byroot wrote: post #228

guard-of-terra wrote: post #139

Earlier quoted context omitted.

Why not finance helping quadriplegics from increased VAT? If it comes to that, why not finance helping quadriplegics from charity?

> Why not finance helping quadriplegics from increased VAT? Because VAT, beside being a very effective tax (it's the biggest source of income of most countries), is the most unfair one. Say a country have a 20% VAT Low income household need to use the entirety of their income to survive (food, housing, etc). So effectively 20% of their income is collected as VAT. Now a upper class household, let's say they save 25% o…

VAT is already being collected, and Apple contributed to it enormously by creating new markets (like tablets).

That increase can be used to help quadriplegics.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#296

Post by funkyy » Mon, Oct 12, 2015, 3:03 PM UTC

joesb wrote: post #290

funkyy wrote: post #272

Earlier quoted context omitted.

Simple 1% revenue tax on companies with revenue of more than $15 million would fix the issue. No other taxes, just revenue one, no tax credits, no refunds. No hiding costs, no going offshore, no creative accounting. One tax on all revenues that will hit your account. This would also help to cut out all the middle man driving prices up and make the logistic chain quite small. Some countries want to experiment with thi…

์So every broker company who makes profit on 0.05% transaction fee is going bankrupt, and no more high-volume low-profit business.

I assume you write this as a bad thing?

Its better for economy if brokers would focus on long term trades. Also usually high-volume low-profit businesses are the ones that are arbitrating prices and often are just middle man. No need for that. There is a way around. Obviously there would be FEW businesses that would be affected and need to change the way they work, but this comes always with any tax changes.

Anyways, I said all revenue that hits your account. Brokers usually don't keep their money in bank accounts, but in investment accounts, right? Until the money hit their actual bank account they would pay null on trades. So they would pay tax on all withdrawals and payouts to customers.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#297

Post by crazy1van » Mon, Oct 12, 2015, 3:03 PM UTC

kmkemp wrote: post #202

newjersey wrote: post #142

Earlier quoted context omitted.

Apple pays VAT and all the taxes it is legally obliged to pay. Don't blame Apple. They will pay the least amount they have to pay. Fix the loopholes.

Except that the reason the loopholes exist is because of the lobbying of companies that take advantage of them.

How can this loophole get fixed? My (admittedly minimal) understanding is that these companies don't have to pay taxes on the money until they repatriate it. From the perspective of countries like the US or UK, Apple earns very little in "profits" because they have expenses in licensing fees between their own companies that effectively pushes the profit to countries with very low corporate tax rates.

This all sounds sinister and it certainly is clever. But I don't see an easy way to fix it. I don't think a tax system where countries can tax profit that never enters its borders is viable. How would the UK feel if the Cayman Islands levied a tax on profit earned by UK companies?

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#298

Post by wlievens » Mon, Oct 12, 2015, 3:05 PM UTC

tobltobs wrote: post #247

wlievens wrote: post #219

Earlier quoted context omitted.

Give every citizen a yearly vat tax credit?

Wouldn't that require another VAT tax hike to pay for the tax credits.

I was replying to the hypothetical question of how to socially correct a consumption (mainly) based tax model.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#299

Post by robk » Mon, Oct 12, 2015, 3:06 PM UTC

pjc50 wrote: post #158

speleding wrote: post #136

Earlier quoted context omitted.

The corporate tax rate in the US is actually higher than in many EU countries. The reverse is actually true, US companies choosing to base their "head quarters" in Ireland and the Netherlands.

It's worse than that. The "HQ" is in Ireland, but pays "royalties" to an IP holding company in the Cayman Islands, which is where all the profits go, on which no tax is paid. This is the "double Irish" referred to in other comments. Edit: note that you can just go and read the accounts for Facebook UK here: https://beta.companieshouse.gov.uk/company/06331310/filing-h... A very important piece of information is left o…

Those share based payments certainly get taxed when the employees exercise them, so the Exchequer sees a tasty tax base from that at least.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#300

Post by iheartmemcache » Mon, Oct 12, 2015, 3:07 PM UTC

speleding wrote: post #136

exDM69 wrote: post #77

Earlier quoted context omitted.

Apple is a particularly difficult case, because they control every link in the chain of supply from manufacturing to retail and pay less than 1% effective corporate tax from their profits. From every step of the supply chain. It is very difficult, if not impossible, to compete with Apple without having a similar end-to-end control of manufacturing to retail. If a company has to purchase their products from a manufact…

The corporate tax rate in the US is actually higher than in many EU countries. The reverse is actually true, US companies choosing to base their "head quarters" in Ireland and the Netherlands.

So can some tax attorney (we used to have a few on here) or CPA/CA break down how exactly this happened and how other people with corporations can do similar things? If Apple isn't going to be paying their "fair share" (yeah, that's a contentious term I'm throwing around) might as well benefit from the money they spent on lobbying and do the same thing they're doing. I'm in that limbo region where Julius Baer won't approach me as a 25MM+ net-worth individual but I'd still like to minimize what I pay.