5 ms·

Facebook agrees to pay France €106M in back taxes

81 points by amaccuish 6y ago

adventured 6y ago
Let me just check. $27.9 billion in operating income the prior four quarters. $58.2 billion in cash. It appears they will be able to afford the taxes.
- jagged-chisel 6y ago
  About a Euro and a half per French citizen. Good on France...
  - tareqak 6y ago
    > Facebook has agreed to pay the French government €106m (£95.7m) in back taxes to settle a dispute over revenues earned in the country. > > The payment covers the last decade of its French operations from 2009. For the last 10 years
    - bergstromm466 6y ago
      What a joke. American tech companies are parasites.
- smabie 6y ago
  I don't think anyone was the under the impression that they would be unable to afford the taxes.
  - bergstromm466 6y ago
    Do you believe legal loopholes and tax avoidance is not an issue?
- refurb 6y ago
  Luckily we don’t determine the amount of tax you owe based on how much cash you have on hand!
  - bergstromm466 6y ago
    Why wouldn't we? They've used legal loopholes to dodge taxes, and the result of that is a lot of 'cash on hand'...
    - jjeaff 6y ago
      Because there are a lot of reasons you could have a lot of cash on hand. You may have a big upcoming expense. Or that cash might even be from a bank loan that you will need to pay back.
syoussry 6y ago
As a French citizen, I also "agreed" to pay my taxes last year :). I even paid the full amount I was being claimed. How generous of me.
- throwawaynothx 6y ago
  Just curious, if you don't pay your taxes for 10 years as a citizen what happens? do you get arrested at some point?
  - mickael-kerjean 6y ago
    They will get it from your bank account. That's what happened to me over a parking ticket a few years ago as I parked in a spot reserved to the national train company. I refused to pay as the amount was 4 times over what it would cost to park in a disable spot which I did find unfair from a morale standpoint. After some time, they took the money from my bank account.
    - harmoat 6y ago
      In France, they can also take it from your salary.
  - wsc981 6y ago
    I'm sure it depends on the country. In The Netherlands one could be sent to prison for tax evasion [0]. --- [0]: https://www.europarl.europa.eu/cmsdata/124710/Netherlands%20fiche.pdf https://www.europarl.europa.eu/cmsdata/124710/Netherlands%20...
- sukilot 6y ago
  Facebook also plays the full amount it claims. The issue is that there was an ambiguity in the law that was recently discussed and resolved.
  - sp332 6y ago
    The social networking giant did not share details of the tax dispute Do you have a good description of what the ambiguity was?
0xy 6y ago
Here's an interesting truth that many of you might not know. When you're a large multinational company or a very high net worth individual, then taxes aren't really an objective calculation. The tax code in most countries, despite being tens of thousands of pages of legalese, are extremely subjective. This subjective and loose language allow for innumerable loopholes and tax dodges. If you're using these creative methods, the chances are that you'll get audited every single year by the IRS or local equivalent. Trump famously gets audited every year. Your tax lawyers & accountants will then negotiate a tax payment with the tax office. I used the word negotiate because there is no one true formula for tax owed. It doesn't exist, especially not for corporations. When you add in 'creative' intellectual property ownership and royalty payments, then the tax office basically has no idea where money is flowing. This is why EU countries commonly lob these huge penalties. Facebook tries to pay X in tax, and the tax office says they should pay X2, and then after negotiation they pay X1.5.
- burtonator 6y ago
  > innumerable loopholes and tax dodges. ... a better way to look at these are backdoors explicitly added for billionaires and corporations to exploit. You and I have to pay taxes. Large corporations and billionaires do not (not effectively)
  - refurb 6y ago
    Got an example of one of these “backdoors explicitly added for billionaires to exploit”?
    - rayhendricks 6y ago
      I’m not an accountant or tax lawyer but here you go: https://www.investopedia.com/articles/investing/102515/carried-interest-loophole-americas-tax-code.asp https://www.investopedia.com/articles/investing/102515/carri... Carried interest is a share of a private equity or fund's profits that serve as compensation for fund managers. Because carried interest is considered a return on investment, it is taxed at a capital gains rate, and not an income rate. Critics argue that this is a tax loophole since portfolio managers get paid from that money, which is not taxed as income. Advocates of carried interest argue that it incentivizes the management of companies and funds to profitability.

81 points by amaccuish 6y ago

Let me just check. $27.9 billion in operating income the prior four quarters. $58.2 billion in cash. It appears they will be able to afford the taxes.

jagged-chisel 6y ago
About a Euro and a half per French citizen. Good on France...
- tareqak 6y ago
  > Facebook has agreed to pay the French government €106m (£95.7m) in back taxes to settle a dispute over revenues earned in the country. > > The payment covers the last decade of its French operations from 2009. For the last 10 years
  - bergstromm466 6y ago
    What a joke. American tech companies are parasites.
smabie 6y ago
I don't think anyone was the under the impression that they would be unable to afford the taxes.
- bergstromm466 6y ago
  Do you believe legal loopholes and tax avoidance is not an issue?
refurb 6y ago
Luckily we don’t determine the amount of tax you owe based on how much cash you have on hand!
- bergstromm466 6y ago
  Why wouldn't we? They've used legal loopholes to dodge taxes, and the result of that is a lot of 'cash on hand'...
  - jjeaff 6y ago
    Because there are a lot of reasons you could have a lot of cash on hand. You may have a big upcoming expense. Or that cash might even be from a bank loan that you will need to pay back.

syoussry 6y ago

As a French citizen, I also "agreed" to pay my taxes last year :). I even paid the full amount I was being claimed. How generous of me.

throwawaynothx 6y ago
Just curious, if you don't pay your taxes for 10 years as a citizen what happens? do you get arrested at some point?
- mickael-kerjean 6y ago
  They will get it from your bank account. That's what happened to me over a parking ticket a few years ago as I parked in a spot reserved to the national train company. I refused to pay as the amount was 4 times over what it would cost to park in a disable spot which I did find unfair from a morale standpoint. After some time, they took the money from my bank account.
  - harmoat 6y ago
    In France, they can also take it from your salary.
- wsc981 6y ago
  I'm sure it depends on the country. In The Netherlands one could be sent to prison for tax evasion [0]. --- [0]: https://www.europarl.europa.eu/cmsdata/124710/Netherlands%20fiche.pdf https://www.europarl.europa.eu/cmsdata/124710/Netherlands%20...
sukilot 6y ago
Facebook also plays the full amount it claims. The issue is that there was an ambiguity in the law that was recently discussed and resolved.
- sp332 6y ago
  The social networking giant did not share details of the tax dispute Do you have a good description of what the ambiguity was?

0xy 6y ago

Here's an interesting truth that many of you might not know. When you're a large multinational company or a very high net worth individual, then taxes aren't really an objective calculation. The tax code in most countries, despite being tens of thousands of pages of legalese, are extremely subjective. This subjective and loose language allow for innumerable loopholes and tax dodges. If you're using these creative methods, the chances are that you'll get audited every single year by the IRS or local equivalent. Trump famously gets audited every year. Your tax lawyers & accountants will then negotiate a tax payment with the tax office. I used the word negotiate because there is no one true formula for tax owed. It doesn't exist, especially not for corporations. When you add in 'creative' intellectual property ownership and royalty payments, then the tax office basically has no idea where money is flowing. This is why EU countries commonly lob these huge penalties. Facebook tries to pay X in tax, and the tax office says they should pay X2, and then after negotiation they pay X1.5.

burtonator 6y ago
> innumerable loopholes and tax dodges. ... a better way to look at these are backdoors explicitly added for billionaires and corporations to exploit. You and I have to pay taxes. Large corporations and billionaires do not (not effectively)
- refurb 6y ago
  Got an example of one of these “backdoors explicitly added for billionaires to exploit”?
  - rayhendricks 6y ago
    I’m not an accountant or tax lawyer but here you go: https://www.investopedia.com/articles/investing/102515/carried-interest-loophole-americas-tax-code.asp https://www.investopedia.com/articles/investing/102515/carri... Carried interest is a share of a private equity or fund's profits that serve as compensation for fund managers. Because carried interest is considered a return on investment, it is taxed at a capital gains rate, and not an income rate. Critics argue that this is a tax loophole since portfolio managers get paid from that money, which is not taxed as income. Advocates of carried interest argue that it incentivizes the management of companies and funds to profitability.