Research Finds $100 Billion Tax Gap in Top Six Silicon Valley Giants

According to a new analysis by Fair Tax Mark, a British organization assessed global tax payments from Facebook, Apple, Amazon, Netflix, Google and Microsoft between 2010 and 2019 and has accused a combined “tax gap” of more than $100 billion.

Crux of the Matter

1. The research looked at tax provisions which are the amount companies set aside in their financial reports to pay taxes and compared those to the amounts that were actually handed over to the government. The difference between these combined for the six companies is nearly $100.2 billion.

2. Amazon is named as the worst offender as it had paid only $3.4 billion in income taxes since 2010 which is 12.7% of its profits despite corporate tax in the U.S. being set at 35% for 7 years and 21% from last 3 years.

3. Facebook has the second biggest tax gap with 10.2% of its profit paid as tax made over the decade. Its has only 5% foreign tax charge which is the lowest amongst the six companies.

4. Google is ranked third with its taxes amounting to 15.8% of profits and foreign tax charge at 7.1%.

5. Netflix ranks fourth with 15.8% of its profit paid as tax followed by Apple on the fifth position with a tax rate of 17.1%.

6. Microsoft paid the highest rate of tax of 16.8%.

7. Report claims that profits continue to be “shifted to tax havens, especially Bermuda, Ireland, Luxembourg and the Netherlands.”

Curiopedia

Silicon Valley is a region in the southern part of the San Francisco Bay Area in Northern California that serves as a global centre for high technology, innovation, and social media. The word “silicon” in the name originally referred to a large number of innovators and manufacturers in the region specialising in silicon-based MOS transistors and integrated circuit chips. The area is now home to many of the world’s largest high-tech corporations, including the headquarters of more than 30 businesses in the Fortune 1000, and thousands of startup companies. Silicon Valley also accounts for one-third of all of the venture capital investment in the United States, which has helped it to become a leading hub and startup ecosystem for high-tech innovation and scientific development. More Info

Curated Coverage

1. CNBC – Silicon Valley giants accused of avoiding over $100 billion in taxes over the last decade

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