- Facebook is closing its Irish subsidiary due to mounting pressure from regulators over the way taxes are paid in the EU.
- The company’s Irish holding company had sales of approximately $ 30 billion in 2018 – more than half of the company’s total annual sales of $ 56 billion.
- A Facebook spokesman said the move was in line with recent and upcoming tax law changes that have been advocated by policy makers around the world.
- You can find more stories on the Business Insider homepage.
Facebook is set to wind up its Irish holding company amid major disputes over the way taxes are paid in the European Union.
In 2018, the Irish subsidiary of the social networking giant paid just $ 101 million in taxes and grossed more than $ 15 billion.
Subsidiary Facebook International Holdings I Unlimited Company also had sales of approximately $ 30 billion, which is more than half of the company’s total annual sales of $ 56 billion.
In a statement to The Times in London, a Facebook spokesman said the Irish company was “wound up in a change that best fits our operational structure”. They added, “We believe this is in line with the recent and upcoming tax law changes advocated by policy makers around the world.”
Big tech companies are facing increasing pressure on the continent as regulators reassess the responsibility that big platforms should have for everything from data sharing to misinformation.
Late last year, Google moved its own intellectual property holdings back to the US from Ireland after regulators closed a loophole that allowed US companies to delay paying taxes.
The tax strategy was legal and allowed Google to avoid triggering US income taxes or European withholding taxes on the funds that make up the bulk of its profits overseas.
Facebook’s decision comes just months after the company took legal action against the Irish data regulator, which is also trying to prevent EU user data from being sent to the US.
The firm’s lawyer, Paul Sreenan, told the Irish High Court the ruling could have “devastating consequences” and mean that Facebook’s core app and Instagram as a whole will be kicked out of the EU.
Business Insider reached out to Facebook for more comments.