UK Tax Bill Of Facebook Tripled In 2017

In 2017, Facebook paid a total of £15.8 million in UK tax. It is triple the amount that it paid in 2016 as tech companies come under heightened scrutiny by the HMRC.

In accounts that were filed last week on the Companies House, it revealed that the profits of the social media giant for its UK office, which covers the expenses on sales, engineering support, and marketing increased by 6.3 percent to £62.7 millon last year, up from the £58.4 million that was reported a year earlier.

Its revenue increased to £1.2 billion, an increase of more than a third year-on-year, because of an increase in advertising reseller activities and intercompany services. Facebook paid only £5.1 million in tax two years ago.

The news comes after a push by Philip Hammond, the UK chancellor, to put pressure on large tech companies to pay higher amounts of corporate tax, as most of them channel their sales through other countries such as Ireland in order to avoid a huge tax bill.

Last week, it was revealed that Airbnb, an online rentals platform, paid onyl a shy of £600,000 in UK tax in 2017 as its UK office operates under a structure that is similar to that of Facebook that provides marketing services to its Irish parent.

Last mothn, Hammond pledged during the Conservative party conference that the United Kingdom would “go it alone” if necessary by implementing a so-called digital services tax.

The proposition was welcomed with public outcry from industry leaders, who said that the measures will only affect smaller businesses and consumers in the United Kingdom.

The vice president of Northern Europe of Facebook, Steve Hatch, said that the tax results reflect the first full year under the updated tax structure of Facebook, which moved all of its revenue from customers who are supported by UK teams to be recorded by the UK business.