London: Social media giant Facebook’s Italian headquarters were reportedly raided by police as part of a growing international crackdown on ‘tax avoidance’.
“Facebook pays taxes in Italy as part of its activity in the country and takes its obligations in terms of Italian tax law very seriously,” The Telegraph quoted a spokesman for Facebook, as saying.
According to the paper, the investigation into Facebook came as it emerged Starbucks deal to voluntarily pay more tax in the UK could see its global tax payments reduce.
This week Starbucks agreed to pay an 20 million pounds over two years in UK tax. However, leading tax experts at Tolley have calculated that increased tax payable could result in a corresponding decrease in tax payable in other jurisdictions.
“Effectively, this could mean that on account of disallowing costs in the UK, there is a corresponding reduction of profits in the Netherlands and Switzerland. This is provided that the Dutch and Swiss authorities accept these amendments,” said Ben Saunders, Tolley tax business manager.
The investigation also comes just weeks after Google faced similar action, after the web giant was suspected of having failed to declare millions of euros in income, the paper said.
However, Google denies any wrongdoing, stating that it “complies with tax law in every country in which it operates and we are confident we comply with Italian law”, it added.