Skip to comments.Starbucks says may pay more UK tax
Posted on 12/02/2012 5:11:57 PM PST by granada
Coffee chain Starbucks said it was considering changes to its UK tax practices, which allowed it to make billions in revenue while paying little in income taxes, following criticism from lawmakers, tax campaigners and the media.
A Reuters examination of Starbucks accounts published in October showed the company had reported 13 years of losses at its UK unit, even as it told investors the operation was profitable and among the best performing of its overseas markets.
The chain's UK unit paid no corporation tax - a tax on a company's income - in the last three years for which figures are available and has only paid 8.6 million pounds income tax since 1998, despite racking up 3 billion pounds ($4.8 billion) of sales.
The revelations led to calls for a boycott of the store and protests at its branches, and the company's Chief Financial Officer Troy Alstead was called to give evidence to a parliamentary committee.
Starbucks repeated on Sunday that it had always complied with British tax laws and blamed its low tax payments on a tough operating environment in the UK.
However, a spokeswoman added in an emailed statement that the public mood had caused the company to reconsider its tax arrangements, which include intercompany royalty and interest payments that reduce the UK unit's taxable profit.
"We have listened to feedback from our customers and employees, and understand that to maintain and further build public trust we need to do more," she said.
(Excerpt) Read more at reuters.com ...
The moochers must have your moolah!
I'll take a latte, no whip, and light on the "fair share." Socialism sucks when it happens to you Starbucks.
I was listening to a show on the BBC on this topic. This is the next media meme to be imported here. The UK left has been demonizing companies for “tax avoidance”, which amounts to savvy use of the tax code to reduce taxes. The left there is claiming that while it is legal for corporations (and wealthy individuals) to use deductions or create limited companies to reduce their tax liabilities, it is “immoral” or “unfair” to do so. The public relations backlash has caused Starbucks to make noises about somehow paying more to the Revenue Service. Either their sales fell or the Brits don’t like burnt coffee.
Expect the media wing of the Obama regime (MSDNC, CNN and just about everyone else) to start floating this garbage barge any day now. And sadly, as November 6 proved, a majority will lap it up.
Like Soros, GE, Apple or Berkshire-Hathaway...or Bono?
Oh, they’re Libs...
Right. Liberal outrage is selective, and they’ll use their false morality to attack right-leaning or neutral companies and extort money from them. That is their idea of “fair”.
Starbucks doesn’t write UK tax law and if they were violating the law, they would be in trouble. Intl corporations have transfer prices, royalty and mgmt fees which do reduce taxes in one country but raise liabilities in others. They usually operate under agreements with the countries involved and stick to a consistent standard. The UK has only themselves to blame.
My guess is that Starbucks was expanding so rapidly that they had a lot of expense right offs for new stores.