Facebook boss ‘comfortable to pay extra tax in Europe’

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Image copyright Drew Angerer
Image caption Mark Zuckerberg says Facebook desires tax reform

The boss of Facebook says he accepts tech giants could need to pay extra tax in Europe in future and recognises individuals’s “frustration” over the problem.

Mark Zuckerberg additionally stated he backed plans by assume tank the Organisation for Economic Co-operation and Development to discover a world resolution.

Facebook and others have been accused of not paying their fair proportion of tax in international locations the place they function.

But some say the OECD is transferring too slowly in direction of its objective of a 2020 deal.

In the UK, Facebook paid simply £28.5m in company tax in 2018 regardless of producing a file £1.65bn in British gross sales.

At the time tax campaigner and MP Margaret Hodge stated such a low invoice was “outrageous”, however Facebook stated it pays what it owes.

In a convention in Munich this Saturday, Mr Zuckerberg will say: “I perceive that there is frustration about how tech corporations are taxed in Europe.

“We additionally need tax reform and I’m glad the OECD is this. We need the OECD course of to succeed in order that we now have a steady and dependable system going ahead.

“And we accept that may mean we have to pay more tax and pay it in different places under a new framework.”

Image copyright Getty Images

The UK has stated it plans to introduce its personal digital providers tax in April, regardless of US objections, in a move that would generate as much as £500m a yr.

However, it’s unclear how the resignation of Sajid Javid as chancellor – a serious supporter of the tax – will have an effect on the move.

France has agreed to postpone its personal digital gross sales tax, however solely till the top of the yr, pending a worldwide settlement. Washington had threatened to impose tariffs on French champagne and cheese in retaliation.

What is a digital gross sales tax?

Many governments are involved that US expertise giants are avoiding taxes within the European Union. They argue taxes ought to be primarily based on the place the digital exercise – shopping the web page – takes place, not the place corporations have their headquarters.

In response the UK, together with a number of different European international locations, have proposed new tax rules.

Britain, for instance, would tax the revenues of search engines like google and yahoo, social media platforms and on-line marketplaces at 2%. France’s objective has been 3%.

But commerce officers in Washington say US corporations are being unfairly focused.

In January US Treasury Secretary Steve Mnuchin threatened new tariffs on UK carmakers, arguing the digital tax could be “discriminatory in nature”.