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Facebook funnels its foreign profits into its Irish subsidiary. As the Guardian article explains: Facebook is structured so that companies buying advertisements on the website in the UK, or anywhere outside of the US, have to pay Facebook Ireland. As a result, Facebook manages to slash its taxes in other countries, paying, for example, $380,800 in British tax on estimated 2011 UK profits of $280 million, or a little over 0.1%. What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.
What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.
Originally posted by gladtobehere
reply to post by WhereIsTheBatman
I consider myself to be relatively well versed on inflation, debt, monetary policy and taxes.
But I'm confused by this line:
What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.
Can someone explain its meaning?
Originally posted by LittleBlackEagle
Originally posted by gladtobehere
reply to post by WhereIsTheBatman
I consider myself to be relatively well versed on inflation, debt, monetary policy and taxes.
But I'm confused by this line:
What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.
Can someone explain its meaning?
that is a strange statement to say the least. i'm thinking they had the right loop holes in Ireland, to make their 1.3billion profit look like a 24million loss?
Source
For those unaccustomed to the loopholes and shelters of the corporate tax code, GE's success at avoiding taxes is nothing short of extraordinary. The company, led by Immelt, earned $14.2 billion in profits in 2010, but it paid not a penny in taxes...
Originally posted by BlindBastards
Companies like this are just take take take. Is it any wonder the Western world is in disarray? Sucking it dry and killing their economies. Something has got to give...
Originally posted by FatherStacks
But how can we hold their "feet to the fire" and get mega-companies like these to start paying their fair share? It's a nearly impossible task.
Originally posted by WhereIsTheBatman
In the mean while, the average Joe who bailed out the banks pays the full price.
Originally posted by randomname
how can running a free website result in it making $1.3 billion and then posting a $24 million loss.
something fishy in marine land.
Originally posted by zerohaze
I believe this article is speaking about the tax paid on Facebook's foreign revenue (profits made outside of the US).
Originally posted by links234
Originally posted by FatherStacks
But how can we hold their "feet to the fire" and get mega-companies like these to start paying their fair share? It's a nearly impossible task.
Ending the practice of single taxation for companies based in the US. What these tech companies are doing is basing their profit headquarters in Ireland (the highest tax rate for business' is 11%) because if you're taxed once by a foreign nation the US doesn't tax you again. This is how a three story building in the Cayman Islands can house 3,000 US companies at a 1% tax rate.
If you post losses and not profits then you can stand to get money back from the government, making your effective tax rate negative. If I had a lot more knowledge about it I'd have a lot more money, but that's the gist of it.
Originally posted by WhereIsTheBatman
Dear mods,
I didn't know where exactly to put this subject. If needed, please move.
Facebook funnels its foreign profits into its Irish subsidiary. As the Guardian article explains: Facebook is structured so that companies buying advertisements on the website in the UK, or anywhere outside of the US, have to pay Facebook Ireland. As a result, Facebook manages to slash its taxes in other countries, paying, for example, $380,800 in British tax on estimated 2011 UK profits of $280 million, or a little over 0.1%. What is shocking is that Facebook paid so much Irish tax since it managed to convert its $1.3 billion gross profit into a net loss of $24 million.
[url=http://www.businessinsider.com/surprise-facebook-avoids-its-european-taxes-2012-12]
Well, if you wonder how the rich get even richer, this is part of the answer. Rich people have the money and means at their disposal to hire the best consultants. They know the gaps in the legal system and that's how profits are made.
The cost of hiring a few good consultants is peanuts compared to the benefits. The result is that their actions are technically legit. Just another example of how law and morals aren't the same thing at all.
In the mean while, the average Joe who bailed out the banks pays the full price.
edit on 29-12-2012 by WhereIsTheBatman because: typo
reply to post by sconner755
Their morals are totally legit. They have a professional, legal, and moral obligation to maximize the returns for their investors and shareholders. It's not their fault that idiotic masses of people vote in idiotic leaders that write idiotic tax laws.