Despite earning more than one billion dollars in profits last year, the major social site Facebook paid no taxes in the US. A latest report has revealed the fact recently.
According to sources, the fact it that the website will actually be getting a refund totaling 429 million dollars due to a tax reduction for executive stock options.
It has been said that in the coming years, Facebook will continue to get monster tax breaks, totaling about three billion dollars.
According to Robert McIntyre, of watchdog group Citizens for Tax Justice, the employees cash in stock options, and at that point there is tax deduction for the company.
Because even though it doesn't cost Facebook a nickel, the government treats it as wages and they get a deduction for it, and usually it doesn't wipe out companies whole tax bill, although many companies get big breaks from it, he added.
The news comes after President Obama's State of the Union speech in which he called for such tax breaks to end.
The county would "save hundreds of billions of dollars by getting rid of tax loopholes and deductions for the well-off and well-connected," Obama said in his speech on Tuesday.
(With inputs from ANI)
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