US coffee giant Starbucks has reportedly paid just euro 10.62 m in corporation tax during14 years of trading in Britain - and nothing in the last three years.The American coffee firm is valued at euro 31 billion.
It generated over euro 3.71 billion billion of sales in the UK since 1998 but has paid less than 1% in corporation tax.
Its nearest European rival, Costa, owned by Whitbread, recorded euro 466m last year, compared to Starbucks' euro 492 m, but Costa's tax bill came to 18.52m, or 31% of its profits.
Starbucks, which has more than 700 outlets in the UK, said it has paid its "fair share of taxes" in full compliance with UK law and no authority had suggested otherwise.
The Seattle-based firm is the latest company to come under scrutiny for making a poor contribution to HM Revenue & Customs (HMRC) after Facebook and Google met similar criticism.
A four-month investigation by news agency Reuters discovered that Starbucks was able to cut income tax by paying fees to other parts of its global business, such as royalty payments for use of the brand.
This means Starbucks UK is effectively making a loss and therefore does not have to pay any corporation tax.
As a result, it has not broken any law. But Labour MP and tax campaigner Michael Meacher said Starbucks' practice is "profoundly against the interests of the countries where they operate and is extremely unfair... they are trying to play the taxman, game him. It is disgraceful".
This is one of the typical examples why the EU needs a uniform tax code so multi-national corporations can't play games games with local tax systems like Starbucks and others are presently doing.
EU-Digest
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