Facebook shut down on Sunday, several holding companies in Ireland responsible for international sales, to avoid paying taxes in the US, the UK and hundreds of other countries.
According to Guardian report, the company’s decision to close the Irish pisions and return its intellectual property to the US came shortly after the US Internal Revenue Service (IRS) took the company to court claiming it owed more than $9bn linked to its 2010 decision to shift its profits to Ireland.
Meanwhile, Facebook valued its intangible assets at $6.5bn in 2010, but the IRS claimed the true value was $21bn. In addition, the Facebook statement reported that the Irish holding company was wound up as part of a change that best aligns with its operating structure.
"This change, which has been effective since July this year, best aligns corporate structure with where we expect to have most of our activities and people," the company added. "We believe it is consistent with recent and upcoming tax law changes that policymakers are advocating for around the world, according to BLOOMBERG report.
Later, Facebook faced US lawsuits that could force sale of Instagram, WhatsApp after the U.S. Federal Trade Commission (FTC) and nearly every U.S. state filed lawsuits against the social media company, saying the deals were unfair and ultimately harmed consumers.
Meanwhile, The FTC reported that it would seek an injunction that could, among other things, require pestitures of assets, including Instagram and WhatsApp.”
On other hand, Facebook becomes the second big tech company to face a major legal challenge this year after the U.S. Justice Department sued Alphabet Inc’s Google in October, accusing the $1 trillion company of using its market power to fend off rivals.
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