Facebook to pay just £5m tax bill despite sales quadrupling in the last financial year

SOCIAL media giant Facebook’s UK arm paid just £5.1million in corporation tax last year despite sales rising from £210.7million to £842.4million.

The massive increases came after the firm’s London-based operation chose to sell ads to “large UK customers” from last April.

UK ad revenue has increased significantly since Facebook targeted big business

Facebook had previously routed most of its UK ad sales via Ireland where corporation tax is lower. A “Google tax” in 2015 stopped tech firms diverting UK sales offshore.

But campaigners say they are still not paying their fair share.

Tax Justice Network chief executive Alex Cobham said: “This is one more confirmation if any were needed that international tax rules are not fit for purpose.

“The UK approach to these giant tech companies simply doesn’t deliver the results the public expect.

“Parliament has already given the Treasury the power to require a totally different level of tax transparency through the Finance Bill introduced last year.

Cobham says that the taxation system is flawed for tech companies

“For reasons we do not understand the Government has chosen not to do that.”

A Facebook spokesman said: “Last April, we actively chose to reorganise our company structure to record revenues from our large UK sales customers in the UK.

“We believed this would provide greater transparency on our operations in London and be easier for people to understand.

“These accounts reflect that change.

“We continue to invest and expand in the UK, employing 1,500 people in our new offices by the end of this year, which is also home to our largest engineering base outside the US.”