Bloggers could face hefty tax bill or jail for non-disclosure
Bloggers and celebrities who receive undisclosed gifts or payment to flog products and services under the guise of celebrity endorsement could ultimately wind up in jail for tax evasion.
The rise of ‘Instagram celebrities’ and ‘Influencers’ who post endorsements of everything from their clothes and make-up to where they spent their last holiday on social media websites has created a new headache for both the advertising and the consumer protection watchdogs.
It has also opened up a new area of scrutiny by the tax man, who could present them with a hefty bill .
No less than 600 photographs were posted online in December when London model Cara Delevingne and 160 of her “friends” posed in bikinis on various social media outlets as they partied for a week on a tropical paradise island in the Maldives. They were reportedly wined and dined and given free accommodation on the resort island in exchange for the snaps they posted.
Such “online influencers” who use their high profiles to promote a product, service or business have been pounced on by advertisers to get their message to their target audience.
Some disclose such “collaborations” as an ad but others don’t.
Yet under guidelines by the Advertising Standards Authority for Ireland (ASAI), an ad is an ad no matter how it’s dressed up.
The Competition and Consumer Protection Commission said bloggers who tried to pull the wool over the eyes of the public could be prosecuted under the Consumer Protection Act for “false, misleading information or omission of information”.
If “online influencers” are getting paid or being given gifts by advertisers in exchange for their cyber endorsements – it is a matter for the Revenue Commissioners.
They now scan the web to “identity, target and confront” bloggers who may be breaking the law by not declaring “products, or other non-monetary benefits, in return for posting online promotion of the product”.
Sanctions could range from a warning to criminal prosecutions for tax evasion in more serious cases, a spokeswoman said.
