Facebook accused of exporting earnings to Cayman Islands

Facebook has apparently landed itself in another tax evasion after allegations surfaced that it exported an estimated 645 million pounds warned in the UK and other markets to the Cayman Islands last year.

The social networking giant uses a subsidiary in Ireland to collect advertising revenue from around the world where its business is booming but the Irish government collected just 4.4 million pounds in tax.

According to the Guardian, with a tax structure known as the 'double Irish', employed by a number of American multinationals, Facebook shelters much of the money it earns outside its home market from governments around the world.

Despite earning an estimated 223 million pounds in Britain, it did not pay any tax last year.

The report said that Facebook takes full advantage of London's status as a hub for European advertisers.

Meanwhile, a spokesman for the company said that Facebook abides by all relevant corporate regulations including those related to filing company reports and taxation adding that their international headquarters in Ireland employs almost 400 people and a series of smaller local offices providing support services all over Europe.

The Dublin-based subsidiary collected revenues of 1.5bilion last year, but this was wiped out by two items - the cost of sales and payments made to other group companies.

The second subsidiary is based in Ireland but doesn't fill full public accounts making any payments out of Facebook Ireland Holdings, owned by Facebook subsidiaries based in the Caymans, untraceable, the report added.