VAT evasion of 887 million euros. New accusation for Meta. The Milan Prosecutor’s Office has closed the investigation and, for the first time in an investigation, the financial and fiscal weight of the data and not of privacy is contested. Not a detail, but a revolutionary question for the digital world. The company immediately responded that it respects its tax obligations and cooperates with the authorities, but that it contests the application of VAT on user access to online platforms.
The accusation of the Milan Public Prosecutor’s Office against Meta Platforms Ireland Limitedthe European division of the social media giant Facebook and Instagram, focuses on the failure to pay VAT for the years 2015 to 2021 on a declared taxable amount of almost 4 billion euros. The accusatory thesis claims that the apparent free use of Facebook and Instagram hides an exchange: users access digital services in exchange for the transfer of their personal data, used by Meta for commercial purposes. According to the Milanese prosecutors, this form of mutual exchange would fall under the VAT regime. Therefore Meta would have failed to declare over 3.9 billion euros of taxable income, equal to VAT evasion of 887 million euros.
Meta immediately declared his disagreement compared to the idea that access to platforms should be subject to the payment of VAT. “We have collaborated fully with the authorities and will continue to do so. We pay all the taxes required in the countries in which we operate”, stated the company, which however underlines how the model proposed by the Prosecutor’s Office undermines the logic of free online services, opening a precedent for the entire digital sector.
In fact, it is an absolute novelty in the legal and tax landscape. For the first time, an economic value is attributed to personal data not in terms of privacy protection, but as an element of commercial exchange. The investigation highlights how user data can represent an indirect tax, rather than simply a company asset. Meta would have profited from data profiling, without complying with the VAT obligations established by law. This model could now put other big techs under scrutiny as well, broadening the debate about the role of data in the digital economy.
The tax investigation comes after the fine of almost 800 million euros, last November, for violating antitrust rules. The giant was accused of having exploited Facebook’s dominance to favor the Facebook Marketplace ad service, to the detriment of the competition. But this time there is something else at stake. The issue is not just about charges of tax evasion, but raises fundamental questions about the economic value of personal data. The concept of “free” in the digital world risks being redefined, with potential repercussions for the entire global economy.
