Google and Facebook hide size of income in Estonia

Photo: SCANPIX

A number of European countries are frustrated with Internet giants providing services and earning income on local markets, while «optimizing» payment of taxes. Google and Facebook, both selling ads to Estonian customers, draw lion’s share of criticism.

This weekend, a debate arose in Sweden, after the public TV-station SVT revealed Google’s and Facebook’s tax payment data. According to SVT, Facebook paid about €90,000 of tax money, while making tens of millions of euros worth of sales revenue in Sweden. Google’s last year’s Swedish taxes amounted to €11,000 with €350m of income – a gap much wider than that of Facebook.

According to the Finnish newspaper Kauppalehti, Sweden’s minister of Anders Borg commented that he has been in talks with colleagues in Germany and some other countries about taxation of large Internet companies. Mr Borg thinks more taxes can be extracted from them in the future.

Estonia’s Tax Board refused to comment on whether the US giants Google and Facebook have ever paid a cent of tax money in Estonia, as the law prohibits disclosure of taxpayers’ data. A Google spokeswoman Gabriela Chiorean, being asked by Postimees if they ever paid taxes in Estonia, replied: «We fully comply with taxation rules in every country we are involved in.» Google would not reveal its profits in Estonia, separately. Facebook left the question by Postimees unanswered.

In addition to advertisement services’ revenue, Google and Facebook are also present in Estonia by local users uploading content to their sites, as in the recent case of a video from a school in Tõstamaa showing a teacher being bullied by students – prompting local media discussions whether or not to show the material on their sites, whether or not to blur the persons involved etc. All the while, however, the video was freely available on Google’s Youtube, spreading rapidly via Facebook links.

According to Data Protection Inspectorate’s (DPI) adviser Stiina Liivrand, DPI asked Facebook four times to remove content in 2012. In ten cases of people asking for such help, they were advised to address Facebook directly. DPI has an established channel of communication with Facebook, the company’s representatives in Central and Eastern Europe having also visited the inspectorate in person. This year, DPI has had to address Facebook twice, already.

With Google, however, DPI has no direct line of communication. According to Ms Liivrand, European data protection agencies have an agreement that, as the need arises, Google will be addressed via French data protectors, as Google is represented in France by local headquarters. With people having issues with Google’s search results, as a rule, DPI advises them to address the companies concerned.