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9am Lowdown: Facebook’s corporation tax pittance

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12th Oct 2015
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Morning! Here’s the news.

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Facebook’s corporation tax pittance

Facebook UK paid just £4,327 in corporation tax last year, while its employees earned an average of more than £210,000 last year in pay and bonuses.

The Guardian reports that Facebook made an accounting loss of £28.5m in Britain in 2014, after paying out more than £35m to its 362 staff in a share bonus scheme.

Operating at a loss meant that Facebook was able to pay less than £5,000 in corporation tax to HMRC for the year.

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Former IMF chief economist backs people QE

Richard Murphy’s “People’s QE” has been endorsed by Olivier Blanchard, former IMF chief economist, as an option to help economies fight future economic crises.

People’s QE is the idea that rather than central banks just buying assets, they should instead spend money on real goods (like infrastructure) as a way of stimulating the economy.

“There is clearly something else you can do if you get to zero (inflation) and still want to increase spending. You can buy goods.”

“Which one should you choose? We haven't asked the question in the crisis but we should,” he said.

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Pensioners offered state pension top-up

More than seven million Britons are being offered the chance to top up their state pensions, reports the BBC.

Men over the age of 65 and women over the age of 63 can get up to £25 a week extra on their state pension, in return for a one-off payment.

The offer is open to existing pensioners and anyone who will reach state pension age before April 2016.

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Replies (6)

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By Omega BAS
12th Oct 2015 10:00

It is rather hilarious that there is a big uproar that big companies pay low corporation tax when the tax & nic paid on salaries brings more money to the taxman.

But it definitely makes a good headline story for the laymen.

Thanks (2)
By ShirleyM
12th Oct 2015 10:32

It's also hilarious (not)

That most UK companies pay corporation tax and have employees, and the profits are more likely to stay in the UK. Talk about an unlevel playing field.

Why are international companies given a big advantage over UK companies just for taking money out of the UK? It's like a home goal in my eyes.

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Stepurhan
By stepurhan
12th Oct 2015 10:38

Tax on loss?

I'd be quite interested in knowing what add-backs they had to be paying tax at all. That is a fairly big accounting loss to turn back around into a profit for tax purposes.

The other question is whether Facebook as a whole is making any money. i.e. Is it a case of Facebook moving profits out of the UK to avoid paying tax here, or is it not making profits anywhere to be taxed.

Thanks (1)
Replying to lionofludesch:
Andrew Jackson
By Andrew Jackson
13th Oct 2015 17:26

They actually seem to have a

Stepurhan:  They actually seem to have a trading profit for the year, covered by losses brought forward. The tax seems to be on interest received. The accounting loss comes from a £35m charge for RSUs, which of course gets added back, and the tax deduction for RSUs isn't enough to eliminate their current-year profits.

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By carnmores
12th Oct 2015 20:59

well its partly the fault of us Irish
Low corp tax rates and IP washing

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Stepurhan
By stepurhan
14th Oct 2015 08:17

Source?

Thanks for that.

If that is the case it would seem the low amount of tax is no more a news story than if a completely UK company with losses brought forward didn't pay much tax. Probably just laziness on my part, but any chance you could provide a link to where you found that info.

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