Facebook raises Irish holding company for tax avoidance

Facebook has closed the Irish holding company that it has used for tax avoidance for many years.

Facebook moves key assets out of Ireland | Ireland | The Times
https://www.thetimes.co.uk/article/facebook-moves-key-assets-out-of-ireland-5th5j9f86

Facebook Shutting Irish Units at Center of Tax Dispute: Times --Bloomberg
https://www.bloomberg.com/news/articles/2020-12-26/facebook-shutting-irish-units-at-center-of-tax-dispute-times

Facebook to close Irish holding companies at center of tax dispute | Facebook | The Guardian
https://www.theguardian.com/technology/2020/dec/27/facebook-to-close-controversial-irish-holding-companies

Facebook has been using the cheap Irish corporate tax for many years to avoid the tax of 'recording global advertising revenue at an Irish holding company.' In fact, the holding company in question, Facebook International Holdings, recorded revenues of about $ 30 billion in 2018, and Facebook's worldwide sales of $ 56 billion (¥ 5.8 trillion). ), Which accounts for more than half. The average corporate tax of the member countries of the Economic Cooperation and Development Organization is 24.9%, the corporate tax of the United States is 35%, while the corporate tax of Ireland is 12.5%, which is a considerable difference in tax rate, so such tax avoidance measures are effective. was.

Facebook was a precursor to closing the holding company in question, such as transferring user data from Ireland to its home country on December 16, 2020, but Facebook International on December 27, 2020 local time. Holdings has been closed. Facebook explained that it 'dissolved the company as part of a change in line with its management structure,' and said that assets such as the company's intellectual property licenses were transferred to Facebook's headquarters in the United States.

Facebook's move is related to a case in which the Internal Revenue Service (IRS), which controls the enforcement and collection of federal taxes in the United States, has filed a lawsuit seeking additional taxation of 1 trillion yen for unfairly avoiding Facebook's tax. It is believed that it is.

Facebook is sued by the National Tax Agency for not paying 1 trillion yen tax --GIGAZINE

The Guardian, a British letter, points out that Facebook's advertising revenue in the country is £ 2.2 billion, but taxes paid are £ 28.6 million. Regarding the taxes paid by Facebook, Congressman Margaret Hodge, who chairs the Commission on Responsible Taxation, reportedly hooked on 'beggar' and said 'beggars belief'.

In January 2020, Google also decided to reduce tax avoidance using Ireland and Bermuda.

Google Reduces 'Tax Savings' Using Tax Havens: Nihon Keizai Shimbun
https://www.nikkei.com/article/DGXMZO54011920S0A100C2TJC000