Along with thousands of others I’m participating in a boycott (is abstention a better word?!) from Facebook today for one day to highlight their UK tax dodging. Facebook earned £175,000,000 in advertising sales in the UK in 2011, they paid just £196,000 in UK tax. That’s just 0.1% of their turnover compared to the corporation tax level of 25% for profits over £300,000.
Like hundreds of other companies Facebook spirits its cash away through the shifting sands of tax havens and deceptively complicated book keeping.
When a company like Facebook doesn’t pay a fair rate of tax it means deeper cuts in our schools, libraries and hospitals or that the rest of us have to pay more. Instead Facebook profits go into the pockets of shareholders widening the gap further between the haves and the have nots.
Switching off Facebook for just one day may seem like a futile gesture, but actually highlighting one company, especially one with a clean image that is so part of our lives serves several useful purposes.
- It shows us that tax avoidance isn’t just the so called ‘bad guys’ like McDonald’s or Exxon Mobile or Nestle. It’s everyone. In fact according to the New Statesman 98 out of 100 companies in the FTSE 100 use tax havens. Tax avoidance by large companies in the UK is endemic and they’ve been allowed to get away with it unnoticed for too long.
- An individual case like Facebook brings home the scale of avoidance. Not just a few percent – or failing to declare an odd job here or there, but millions and millions of pounds. At a time where we’re seeing such cuts to our basic services this has a massive impact.
- Participating in a boycott like this gives politicians something to work with. Gordon Brown said that he would never have been able to get a deal out of world leaders on developing world debt without the pressure from Jubilee 2000. There are signs that the government is beginning to crack down on tax havens, but they are going to face unparalleled lobbying from supremely well funded pressure groups.Very well off turkeys don’t vote for Christmas and they are going to kick up an almighty stink. Politicians wanting to see action need to have every weapon at their disposal. That includes knowing that they are being watched and that there are possible votes from us in pushing through change.
So change your profile picture or share the logo and lay down your status likes and comments for today. Facebook can manage without you for a day and you might just be part of something that can ensure that companies pay a fair amount of tax to pay for the services we rely on.