Facebook NZ had \u201cgross amounts from advertising and services\u201d of $172.6m from the year-ago $159.4m, offset by \u201cpurchases of advertising inventory\u201d of $166.6m from Meta Platforms Ireland.<\/p>\n
Tax Justice Aotearoa member Nick Miller, a former EY senior manager in Britain and senior investigator with Inland Revenue NZ, has questioned if Big Tech firms minimise their tax exposure with service fees to related parties in territories with lower tax rates than NZ or the US.<\/p>\n
Ireland has a corporate tax rate of 12.5%, compared to New Zealand\u2019s 28%. <\/p>\n
Miller says that if service fees to an offshore parent include a royalty, then withholding tax should be paid (none of the tech multinationals approached by the Herald have offered a detailed breakdown of service fees, all have said they are compliant with all tax laws). <\/p>\n
Local bank accounts drained<\/p>\n
There was one new feature of this year\u2019s accounts.<\/p>\n
Facebook NZ reported $22.46m in cash and equivalents at the end of 2024, which had reduced to $0 in 2025.<\/p>\n
In January 2025, an intercompany cash pooling system was introduced (on both sides of the Tasman) which sees surplus cash from subsidiaries moved to a centralised account controlled by a corporate parent. <\/p>\n
The Herald understands Meta earlier established an \u201cin-house bank\u201d for its non-US operations for various subsidiaries, with the move pitched as a way to provide more flexibility for funding across the group. New Zealand and Australia started participating last year.<\/p>\n
Facebook NZ incurred $87,000 in interest expense on borrowings through the intercompany cash pooling arrangement.<\/p>\n
The global picture <\/p>\n
Last month, Meta reported record first-quarter global revenue that rose 33% to a record US$56.3b as net income rose 61% to US$26.7b – but also began cutting around 8000 jobs or 10% of its workforce.<\/p>\n
Analysts saw the staff cull, in part, as a measure to offset an anticipated US$146b in AI infrastructure spending this year, including its \u201cHyperion\u201d 11sq km data centre campus in Louisiana.<\/p>\n
Meta Australia-New Zealand has around 250 staff, the bulk in Sydney.<\/p>\n
Facebook NZ had staff remuneration expenses of $2.4m in 2025, down from $3.2m in 2024 and $3.6m in 2023.<\/p>\n
Roads not taken<\/p>\n
Tax Justice Aotearoa says tens of millions could be raised from individual multinationals, and hundreds of millions collectively, if Big Tech firms paid withholding tax on their service fees (assuming they were dominated by royalties).<\/p>\n
Miller says the measure would outstrip the money that would be raised by a Digital Services Tax – or a flat 3% tax on Big Tech firm\u2019s local revenue. A bill for a DST was introduced by Labour shortly before the 2023 election. It did not have time to pass and was dropped by the incoming National-led Government.<\/p>\n