Facebook will report local ad revenue

The world's largest social network will start recording local advertising revenue, instead of transferring it all to its international headquarters in Dublin.

Facebook Chief Financial Officer Dave Wehner said earlier this week that the company has decided to move to a local sales structure in the countries where it has offices, to support selling ads to local customers.

“Simply put, this means that advertising revenue supported by local employees will no longer be recorded on the books of our international headquarters in Dublin, Ireland, but on our corporate reporting there,” he said. “We believe this sales structure will increase Facebook’s transparency with governments and policymakers globally.”

Facebook will no longer book international revenue through its Dublin headquarters.

Wehner said Facebook would make the change throughout 2018 and complete it in the first half of 2019. Last April, it made a similar move in the UK, when it recorded revenue from large UK customers separately, resulting in a small but significant increase in tax.

Corporate tax remains a hot topic, especially after a series of revelations about tax avoidance schemes by multinational companies, which have sparked calls for companies to pay more.

The European Commission (EC) is considering several legislative proposals to increase taxes on multinational digital companies, which are accused of paying too little tax when they book profits in low-tax countries, such as Ireland or Luxembourg. One of the proposals is to tax advertising revenue.

According to VNE