New Zealand Labour Attacked for 'Mad' Threat to Ban Facebook Over Taxes

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By Reissa Su | January 29, 2014 5:51 PM EST

The New Zealand Labour Party has threatened to ban Facebook and the Internet from multi-national corporations over tax issues. Labour proposed the solution to force corporations to pay more taxes.

REUTERS/Dado Ruvic
A man is silhouetted against a video screen with an Facebook logo as he poses with an Dell laptop in this photo illustration taken in the central Bosnian town of Zenica, August 14, 2013.

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The party recommends that the New Zealand government should talk to Facebook but if this doesn't work, a backup plan must be in place which Labour described as a "credible threat." 

According to Labour, Facebook is the largest social network in the world but pays only little tax in New Zealand. Labour revenue spokesman David Clarke said the government should have the ability to ban Web sites in the country.

New Zealand's Finance Minister Bill English called Labour's proposal as "nuts." Prime Minister John Key said Labour is planning to close down Facebook and remarked "That'll be interesting." Mr Key also declared that Labour party leader David Cunliffe is "barking mad" if he decides to push through with banning Facebook. 

Mr Clark pointed out that sites catering to pedophiles have already been banned around the world. According to reports, Facebook is included in a list of multi-national corporations accused of tax avoidance. Based on latest figures in New Zealand, the company has generated $790,000 in 2012 but after accounting for expenses, the company paid only $28,000.

Mr Clark said it is "completely unbelievable" for a company like Facebook to earn little profit in the country. Mr English has agreed that Facebook should pay their fair share of taxes. However, both parties don't agree in shutting down or banning some Web sites. Mr English thought it was a "ridiculous idea.

Mr Cunliffe's office is not ruling out the possibility of a ban and told media it is considering options to force multi-national companies to pay more taxes.

Key: Cunliffe "misleading" New Zealanders

Meanwhile, the Prime Minister has launched an attack on David Cunliffe's credibility as election date draws near. Mr Key described Mr Cunliffe as "tricky" and questioned his ability to speak the truth to the public.

Mr Key criticised Labour's parental leave scheme which involves a payment of $60 per week. Speaking in a television morning show, Mr Key acknowledged Labour's new policy has merit to some of its elements. However, he said it was not well-targeted and had no funds to support it. He accused Mr Cunliffe of "misleading" the people of New Zealand. 

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(Photo: REUTERS/Dado Ruvic / )
A man is silhouetted against a video screen with an Facebook logo as he poses with an Dell laptop in this photo illustration taken in the central Bosnian town of Zenica, August 14, 2013.
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