With 139 million subscribers worldwide, Netflix reportedly paid NOTHING in state or federal income taxes last year, even though they had the most profitable year to date, raking in $845 million. Not only that, Netflix reported a $22 million federal tax rebate, according to the Institute on Taxation and Economic Policy (ITEP).
Matthew Gardner, senior official with ITEP told DailyMail.com, ‘It is pretty clearly true that Netflix’s cash payment of worldwide income taxes in 2018 was $131 million. But that is a worldwide number—the amount Netflix actually paid to national, state and local governments worldwide in 2018. This tells us precisely nothing about the amount Netflix paid to any specific government, including the U.S.’
Gardner added: ‘Fortunately, however, there is another, more complete geographic disclosure of income tax payments.
‘The notes to the financial statements have a detailed section on income taxes. And what this tells us is that all of the income taxes Netflix paid in 2018 were foreign taxes. Zero federal income taxes, zero state income taxes in the US.’
Gardner added, ‘With a record number of subscribers, the company’s profit last year equaled its haul in the previous four years put together. When hugely profitable corporations avoid tax, that means smaller businesses and working families must make up the difference.’
With Apple, Disney, NBC Universal, and Warner Media all planning to release their own video streaming platforms by 2020, Netflix is looking at significant competition. According to Forbes, Disney has stated it plans to end its licensing agreement with Netflix, and will pull their content before the end of 2019.
In addition, Warner Media may pull their “Friends” series, which Netflix recently paid $100 million to keep on their platform for another 12 months. OUCH.
NBC Universal could join Disney and Warner Media possibly pulling “The Office”, which “NBCU execs say Netflix has told them “The Office” generates more viewing hours than anything else on the service.”
Will Netflix be able to survive amongst all the competition?