The AFR had a crack at Facebook today about their tax paid in Australia.
Facebook Australia was paid nearly $674 million by local advertisers using its platform in 2019, but it trimmed its income tax bill to a little under $17 million through a reselling arrangement that minimised its profits to $22.7 million.
Tax is 2.5% of Facebook revenue whereas tax is 1.76% of revenue for News Corp according to ATO data reported by Michael West: News Australia Holdings revenue over 5 years = $13.9B, taxable income = $246M, tax = zero. Source ATO corporate tax data, as reported by @MichaelWestBiz.
Yes, I get the AFR story is because of the Facebook data being just released. For me, the broader context is interesting.
Our tax system is broken. Tax systems around the world are broken. These massive companies that have the ear of politicians fail to be social responsible tax citizens.
By all means the Nine papers can report about tax paid. However, good journalism would see them report more completely and accurately.
While I am no economist, I wonder about a mechanism of capturing a small percentage of money leaving any Australian bank account. That way, businesses paying Facebook, Google, Twitter and others for ads make the tax contribution they fail to make. Likewise, people paying News Corp. for a subscription make a small tax contribution covering what their structure facilitates them minimises.
Our economy needs tax dollars to fund healthcare, education and infrastructure. tax is another area where small business does heavy lifting.