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Zuckerberg to say Facebook is happy to pay a digital tax

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Support: Mark Zuckerberg will welcome OECD moves at the Munich Security Conference today. Photo: Getty Images

Support: Mark Zuckerberg will welcome OECD moves at the Munich Security Conference today. Photo: Getty Images

Support: Mark Zuckerberg will welcome OECD moves at the Munich Security Conference today. Photo: Getty Images

Mark Zuckerberg for the first time said he supports efforts to create a global digital tax that would ultimately raise the amount Facebook pays to foreign countries, in a move that may boost efforts to put a new levy in effect by year-end.

The tech giant's chief executive will tell world leaders gathered at the Munich Security Conference today that he welcomes the efforts of the Organization for Economic Cooperation and Development (OECD) to find a global compromise on how to tax profits from digital activities.

"We want the OECD process to succeed so that we have a stable and reliable system going forward," Mr Zuckerberg will say, according to a copy of his prepared remarks. "And we accept that may mean we have to pay more tax and pay it in different places under a new framework."

The talks at the OECD are key to maintaining a tariff truce between Europe and the US. If there is no agreement by the end of the year, the French government says it will resume collecting a national digital tax - a levy the US says discriminates against American firms.

Washington has threatened retaliatory tariffs on French goods over the tax.

Facebook will be in court next week to defend its strategy of shifting its profits to Ireland to avail of lower tax rates here. If the company loses, it may have to pay $9bn (€8.2bn) more in tax to the US Internal Revenue Service (IRS), according to a regulatory filing.

Mr Zuckerberg will meet with several European leaders over the weekend as he visits Brussels and the conference in Munich, which will also be attended by French president Emmanuel Macron.

In an effort to advance the global talks on digital tax, the OECD said on Thursday that new rules - including a minimum tax - could boost US government revenues by as much as $100bn.

The talks on tax reform have been running since 2016 and involve representatives from almost 140 countries.

Meanwhile, Facebook said on Friday it was allowing US-based political candidates to run branded content on its social networking platforms.

Branded content is created by celebrities or influential personalities to promote a paid message on social media.

While Facebook requires content creators to disclose any paid partnership, it does not consider such content as advertisement since the company does not charge for it.

"After hearing from multiple campaigns, we agree that there's a place for branded content in political discussion on our platforms", a company spokesman said.

Facebook said branded content from political advertisers will not be included in its Ad Library - a transparency tool for political ads - unless it is promoted using the company's advertising tools.

Bloomberg / Additional reporting Reuters

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