Facebook to reduce Irish tax bill in shakeup

Intense scrutiny of multinationals’ tax arrangements, combined with a range of OECD measures designed to reduce tax avoidance, may have contributed to Facebook’s decision to undertake a major overhaul of its tax structure, according to a leading expert.

Chartered Accountants Ireland’s head of taxation, Brian Keegan, said the social media giant’s decision to book the majority of its British sales through its UK office was probably driven by forthcoming changes to the global taxation environment.

The move will see Facebook handle more sales through its UK operations and consequently pay more tax in that jurisdiction, while having the opposite effect on its Irish business, which acts as the company’s international headquarters.