&gt; Irelands 12.5% seems very reasonable considering its so close to its effective rate.<p>Very little of the actual profits of Facebook are actually subject to the 12.5% corporate tax of Ireland.<p>In a European corporate tax evasion scheme such as Facebook&#x27;s, there&#x27;s typically four to five legal entities in two or three countries. The branch making the actual profits (e.g. Facebook UK) pays their profits as &quot;license fees&quot; to an entity Netherlands or Luxembourg that has a flat-rate tax deal. This money is then transferred to the Irelands, where it stays for a few milliseconds before it is wired over to another corporate entity in NL&#x2F;LUX (&quot;license fees&quot; again), subject to a flat rate fee, and then through ownership deals gets transferred back to Ireland. This trick is called the &quot;double Irish with a Dutch sandwich&quot;, and there are dozens of similar, widely-employed schemes.<p>If this money is actually needed in the US, it gets funneled through one or two hops in Bahamas, Bermuda or Cayman Islands or so.<p>The net result is not 12.5%, more like (12.5%)^2 - (flat rates paid in NL&#x2F;LUX). Effectively down to a few percent.