The UK arm of the worldwide micro blogging site Twitter has reported profits of under £100,000 for the past year in the UK leading to questions being asked about the veracity of the tax returns from Twitter.
It is being predicted that when Twitter is finally floated on the stock market in New York that it will be worth a massive £7.3 billion which makes the profits in the UK of under £100,000, which place the company in the category of being a small company, seem slightly odd for many.
According to press reports Twitter are routing their advertising revenue from the UK through Ireland to avoid a hefty tax bill on the mainland, a ploy that has been used by Google in the past and has been heavily criticised.
A spokesman for Twitter told press that they refused to confirm that any UK sales passed through Ireland because the company was privately owned and this information did not need to be divulged to the public.
A statement from Twitter said: “Since Twitter opened in 2011 we have been steadily building our team, focusing on promoting great uses of Twitter by all elements of UK society – the arts, sport, government and brand partners.”
Twitter UK is owned by a company known as Twitter International and this business is registered to Ireland where in Dublin the company employs around 100 people with a further 60 staff employed in the UK in London.
Most of the business done by Twitter outside of the US passes through Ireland, much like Google, with the head of policy for Twitter for Europe, Africa and the Middle East based in the Irish capital.
Multi national companies including Google, Starbucks and more recently Apple, have all come under fire in the UK for not paying what is considered to be a “fair” amount in taxes.
The UK is currently in economic difficulties with many cuts being made to all aspects of life in the UK which has made the fact that very large companies pay very little tax a hard fact to swallow for many people and this has led to very bad press for these companies in the UK.
At the start of the year the company eMarketer claimed that they believe that Twitter is worth a massive $288 million through global advertising – a figure which is predicted to rise for at least the next two years and one that people want to see the company paying taxes on.