Last year, Airbnb paid just under £600,000 in the United Kingdom tax last year. The disclosure of the tax bill comes as Philip Hammond, the British chancellor, raises calls for a unilateral digital services tax to be imposed on tech companies.
In its financial accounts that are scheduled to be published on Companies House later this week, Airbnb paid only £596,992 in corporate tax in the year ending December 2017 across its two divisions that are based in the United Kingdom.
The said amount was based on its annual operating profit before taxation which amounted to £1.8 million. It was mostly a result of costs of staffing and marketing. Additionally, it represents a three-times rise from its tax payout in 2016 which amounted to £188,000.
In a similar style to other large tech firms in the United Kingdom, including Facebook, Google, and Amazon, the majority of the business profits of Airbnb in the region are channelled through its headquarters in Ireland.
The news comes as Hammond intensified his plans for a so-called “digital services tax” during the Conservative party conference yesterday. He claimed that the United Kingdom would “go it alone” if required with a special corporate revenues tax that is designed to affect big tech companies such as Airbnb.
The proposition was welcome with public outcry from the industry leaders, who said that the measures will only affect smaller businesses and consumers in Britain.
The executive director of the Coalition for Digital Economy, Dom Halls, stated: “If the Chancellor continues to go it alone and pursue a digital services tax he will be cutting growing startups and scaleups off at the knees.”
He added: “The tech giants Philip Hammond claims to be targeting are in fact best placed to deal with an increased tax burden, the true cost will be in hurting innovative British companies who want to develop at home then grow globally.”
While Carolyn Fairbairn, the director-general of the CBI, praised Hammond for bringing back “pride and confidence in British business.” She also raised her concerns over the digital services tax.
She stated: “All businesses are increasingly digital. Any new approach must be built on evidence from enterprise or it risks being blunt and counterproductive.”
A spokesperson for Airbnb stated: “We follow the rules and pay all the tax we owe in the places we do business. Our UK office provides marketing services and pays all applicable taxes, including VAT.”