Facebook shuts down Irish holding companies amid tax dispute

Facebook shuts down Irish holding companies amid tax dispute

Working a company Facebook is moving its main assets outside Ireland, where Filter Irish holding companies that have used it to funnel billions of profits to avoid paying taxes in the US, UK and hundreds of other countries.

Its main Irish subsidiary paid $ 101 million in taxes while recording profits of more than $ 15 billion in 2018, the most recent year for which records are available.

Facebook companies around the world paid the Irish holding company to use its intellectual property.

Facebook International Holdings I Unlimited Company recorded revenues of $ 30 billion in 2018, more than half of Facebook’s total global sales of $ 56 billion.

Facebook’s decision to close Irish holding companies and return their intellectual property to the United States came shortly after the IRS referred the company to court claiming that it owed more than $ 9 billion due to its 2010 decision to transfer its profits to Ireland.

Facebook in 2020 estimated its intangible assets at $ 6.5 billion, but the IRS claimed the true value was $ 21 billion.

Facebook said in a statement: The Irish Holding Company ended as part of the change that better aligns with our operating structure, and its assets have been distributed to the American parent company.

She added: Intellectual property licenses related to international operations have been returned to the United States, and we believe this step is in line with upcoming changes in tax law advocated by policymakers around the world.

Facebook stated that the tax rate over the past five years has exceeded 20 percent, which is in line with the global average of 23 percent, according to the Organization for Economic Cooperation and Development.

The tax rate increased to 25 percent in December 2019 from 13 percent in late 2018, according to the company’s results.

Facebook paid 28.6 million £ in tax in the UK last year, despite it recording £ 2.2 billion in total revenue from advertisers.

Google moved its intellectual property from Ireland to the United States in January, before closing the Irish tax loophole, which US companies used to funnel international profits through Ireland to tax havens like Bermuda, and keep them out of the United States.

Ireland agreed to close the loophole under international pressure five years ago, but companies have been granted until the end of 2020 to comply.

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