back to article Facebook announces ad revenue reroute: When Irish eyes are crying

Facebook has said it will no longer send advertising revenue through Ireland, and instead pay taxes in the countries where profits are earned. In a major overhaul today, the firm said it will make the change in every country outside the US where it has an office. By Dave Wehner, chief financial officer, said: "We believe that …

  1. djstardust Silver badge

    It's over guys.

    Facebook has turned in to a mess.

    Too many obtrusive ads

    Too many like and share competitions they do nothing about

    Too many scams

    Too much fake news they also do nothing about

    Too many attention seeking individuals who need to see a shrink

    The amount of postings from my "friends" has reduced drastically lately and it seems to be a widespread issue. Instead of FB just being friends reunited on steroids it has turned in to a bad social experiment and people are getting sick of it.

    Quicker it fades in to obscurity the better for everyone.

    Too little too late.

    1. Anonymous Coward
      Anonymous Coward

      Re: It's over guys.

      Facebook is competing with Google for the twin titles of

      'Do the most Evil'

      and

      "Give me your life, family friends and everything so that I can flog it off to advertisers"

    2. Naselus

      Re: It's over guys.

      It's in deep shit. Facebook is going to get regulated, and it knows it; the US isn't going to protect Zuck anymore (since the whole 'I let the Russians pay me in rubles to try and fix my own country's election' admission), the EU isn't going to let them dodgy taxes, and increasingly senior figures from within Facebook are coming forward to say they won't use it and don't let their children near it.

      Google should be worried too.

    3. Anonymous Coward
      Anonymous Coward

      Re: It's over guys.

      While many of your points are valid, FB have discovered that users sharing content can be a great way of increasing ad revenue. Particularly if the content would normally require someone to pay for it like sporting coverage.

      Here's a graph showing Facebook success in recent years...

      https://www.statista.com/statistics/277229/facebooks-annual-revenue-and-net-income/

    4. JeffyPoooh Silver badge
      Pint

      Re: It's over guys.

      djsd complained: "Too many obtrusive ads"

      Every morning, spend a few minutes shopping for bikinis.

      For the rest of the day, your ads will be much more attractive.

      1. DougS Silver badge

        Re: It's over guys.

        Eventually Myspace was doomed because of problems with spam, but they were WAY worse than Facebook. Also there was an alternative for Myspace users to migrate to - Facebook.

        Where is the alternative for Facebook users to migrate to? Without that, it is going to take a lot worse before they leave. They might start using it less but they aren't likely to leave.

      2. Ken 16 Silver badge
        Coat

        It's hardly bikini weather

        and I haven't shaved my legs in 50 years

        1. CrazyOldCatMan Silver badge

          Re: It's hardly bikini weather

          and I haven't shaved my legs in 50 years

          Aha! "Wax on, wax off" then?

  2. Anonymous Coward
    Anonymous Coward

    Major tax overhaul to appease users.

    FTFY

    Facebook clearly don't want to lose users over this as it could be a domino effect especially with all the press about NHS/Public services being strained due to a lack of cash, it not difficult for a facebook user to put paying tax and public services together.

    Clearly the government and regulators were never going to do anything about it or they would have a least started, they got them up in front of a parliamentary committee to tell them that they were very naughty and they should pay the right amount of tax and do the right thing rather than legislate.

    I will also believe this when I see it because even if they put them receipts through the UK they can and will still avoid paying full tax.

    1. AMBxx Silver badge

      I bet they won't pay a penny more. They'll just charge expenses or royalties to the local offices. Zero profit, no tax to pay, job done.

      1. JeffyPoooh Silver badge
        Pint

        AMBxx offered: "They'll just charge expenses or royalties to the local offices."

        Email exchange:

        How much royalties does the head office want this year?

        What are your taxable profits?

        Taxable profits are $17,789,563.45 for the fiscal year just ended.

        Your 'Trademark Usage' royalties for the fiscal year just ended are $17,789,563.45.

        Okay, thanks. Cheers.

        Cheers.

      2. Ken 16 Silver badge
        Holmes

        still, it will stop other Governments complaining about Ireland not collecting the tax

        and they can spend their money not collecting the tax instead

  3. Bob the Skutter

    Reducing profits

    Wonder how much loaded it will run up to make these changes?

  4. DougS Silver badge

    How will they allocate the cost?

    In a given country they make X in ad revenue, and have Y in expenses for local sales people and support staff. So their gross margin is X-Y. How will they account for the servers, people to run them, network costs, and so forth? That's where it gets tricky, and a lot of room is left to make that profit shrink to almost nothing.

    It is a lot more transparent for companies that sell products, especially if they don't sell directly but only through third parties. Then it is wholesale price X * units N - local support staff cost - allocated share of corporate overhead = profit. It is easy to allocate your overhead based on the revenue in that country versus your worldwide revenue.

    1. Mark 85 Silver badge

      Re: How will they allocate the cost?

      Never underestimate accountants and their mysterious ways. They will find a way.

      1. Captain DaFt

        Re: How will they allocate the cost?

        Never underestimate accountants and their mysterious ways. They will find a way.

        "He described the move as a "large undertaking" that will require significant resources to implement around the world."

        Looks like they already have that covered.

    2. Richard 12 Silver badge

      Re: How will they allocate the cost?

      Transfer price-based tax evasion and avoidance schemes have been going on for decades.

      The taxman should be wise to that by now, especially after Starbucks.

      Fortunately these are exactly what the change in law making "aggressive" tax avoidance illegal was for.

      1. DougS Silver badge

        "Aggressive tax avoidance"?

        Laws like that are terrible, because what is "aggressive" is subjective. Two people/companies could be using the same method and one found guilty and the other not based on who happens to review their taxes, or if they had a fight with the wife that morning.

  5. Mark M.

    I'll bet the definition of "advertising revenue" gets revised by the FB beancounters so that less tax gets paid when distributed to other countries than is currently paid in a single lump to Ireland.

  6. CrazyOldCatMan Silver badge

    And in other news..

    .. Facebook senior management have recently attended a Hollywood symposium[1] on profit management..

    [1] Amusingly, the ancient Greek form of this (where we get our word from) was basically an excuse to get together, watch/grope dancing girls[2] and drink huge quantities of wine[3].

    [2] These events were men-only aside from the 'entertainment'.

    [3] Also another reason why 'decent' women were not allowed to attend[4].

    [4] Somewhat like tech bro get-togethers in sillycon valley.

  7. tredmondwx

    Irish Eyes crying?

    Why? Facebook pays bugger all in tax in Ireland too... Less than 0.1%... The way the Irish tax authorities win from Facebook's presence is income tax from Facebook workers, not corporation tax.

  8. The Count
    Thumb Down

    Notice how they say

    That they will only implement this in countries other than the US. Meaning that all US taxable revenue will still be transferred to Ireland.

  9. This post has been deleted by its author

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