Starbucks 'paid just £8.6m UK tax in 14 years'

Starbucks is a franchise isn't it? So wouldn't the franchises be paying tax on their profits and Starbucks paying tax on any profits on franchise fees and supply fees?
 
Moses said:
You can't just have a token office in a random country and pretend work's done there, to avoid tax. That's not how it works.
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According to the BBC it does....

In June 2008, the high street chemist, Boots, which has a 150-year history in Nottingham, moved the registered head office of its parent company, Alliance Boots, to Zug.

On its website the company gives its address as Baarerstrasse, a central street in Zug.

But a visit to the address, an office block, opposite a pizza takeaway and a hotel, revealed that there is no physical office location in the town. Instead, the registered office is housed in a Swiss post office - in an anonymous post office box alongside dozens of others.

Although Zug is benefiting from an influx of foreign companies, there's concern that simply facilitating the legal registration of companies without attracting the physical relocations of staff and operations will have little long term economic benefit.
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So in fact it's worse than what Edrof stated, there is no one working there at all. All you have to do is register your company as being based in Switzerland and that's it, no staff have to work there and you don't even need an office there.
 
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Moses said:
Selective quotation :cool:.

Did you miss this part,



?

So they do have an actual presence in Switzerland.
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So THEY say, why don't they list that office (if it even exists which I suspect it doesn't and was rather a hasty answer to a BBC journalist asking why he couldn't find the office they list to the public) on their website as their address then?

Try finding it yourself, you have the whole of the internet at your disposal and I doubt you'll find any pictures or phone/address listings of this mythical Boots head office in Zurich, let alone the 1000s of staff that must work there.

The point is the article makes it clear that a company can simply register its name in Zug, pay their taxes there without having to move any staff or resources. Something you claimed didn't just 'work like that' when clearly it does.
 
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Do people in this country still bother drinking weak, milky American coffee from Starbucks? All I ever see these days are Costas, and Starbucks that are closing down.
 
Zodar said:
I'm pretty sure they still paid the VAT and appropriate payroll taxes. This is corporation tax that is discussed in the article.

Thus your thread header is completely false and misleading. They have paid way more in "UK Tax" in the last 14 years.
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This. There are many ways that the government tax companies. One of them is said to be low because it appears that the company has huge turnovers.... People forgot that they also have huge operating costs as it costs a lot to have and maintain a high street presence, and to advertise it.

I can't believe that people are be-crying a major employer which has paid their legal obligations. Move on and look at the bigger picture!
 
Pudney said:
Actually I believe the offshore charges are mostly the original US company's charges and royalty fees.

Starbucks as a whole don't actually do much tax avoidance per se, they just move all their profits to the US by the looks of things and pay tax there. Multinationally that's actually "moral" in the grand scheme of things, they don't actually move profits to low tax havens, in fact the US is a higher tax rate than the UK.

Globally Starbucks pay 24.5% in tax, which is roughly 4.6% of revenues. They're not avoiding tax so much, just choosing to have it all in the US. Weirdly.
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I have no issue with companies declaring their profit elsewhere - as long as that location is their head office, and not some sort of front. In this instance, it appears to be....
 
[TW]Fox;22973225 said:
So presumably they paid no VAT on sales, no tax on salaries paid to staff, no business rates to councils, etc etc?

Oh you mean they did?
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VAT is paid by the customer. It's value added.

Income tax is paid by their employees.

Business rates are a local tax to pay for local services.

So no, they didn't ;)

iamtheoneneo said:
they have paid their share, they create jobs and wealth in this country - I dont get the problem here?
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Have they though? Are they "creating" jobs? How many independent cafes and coffee shops have gone to wall due to their presence? How many retail units are occupied by Starbucks that would be empty otherwise?
 
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Tattysnuc said:
This. There are many ways that the government tax companies. One of them is said to be low because it appears that the company has huge turnovers.... People forgot that they also have huge operating costs as it costs a lot to have and maintain a high street presence, and to advertise it.

I can't believe that people are be-crying a major employer which has paid their legal obligations. Move on and look at the bigger picture!
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For the 1000th time, generating tax by existing doesn't negate your duty to pay corporation so would people stop making this silly (and inaccurate) argument that they pay VAT so it's OK they avoid Corporation Tax.

If Starbucks aren't making a profit here, why don't they close all their shops down then? Why are they reporting to the markets that their UK business is healthy and a good investment whilst telling the tax man they aren't making any money?

They are juggling their accounts to make it appear as if they aren't making any profit, that's all. They are not being 'honest' and doing what is 'expected' of them, they are deliberately running their business in a certain way to avoid paying tax.
 
Tattysnuc said:
I have no issue with companies declaring their profit elsewhere - as long as that location is their head office, and not some sort of front. In this instance, it appears to be....
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No offense, but no multinational serious about avoiding tax moves profits to the US, the tax rate is too high there. And I would seriously argue the proper administrative centre of Starbucks is indeed their home country.

And on the subject of registered offices they mean nothing. A registered office has no need to be somewhere where a company even operates from. Saying nobody works from a registered office means squat.
 
Yeah Starbucks is fine moving all their UK derived profit to the US and paying into their tax system. That's ok by me, they're a US company.

Especially since they're only declaring enough profit to pay £8m Corpororation tax in the last 4 years (or whatever it is) to HMRC.
 
inogen said:
Yeah Starbucks is fine moving all their UK derived profit to the US and paying into their tax system. That's ok by me, they're a US company.
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It's not fine. If you take advantage of trading in the UK, you must pay the appropriate taxes. Public services do not appear out of thin air.

Structuring your business to pay the least amount of tax on the other hand is just good business sense. If the tax regime is allows it, then take advantage of it.
 
inogen said:
VAT is paid by the customer. It's value added.

Income tax is paid by their employees.

Business rates are a local tax to pay for local services.

So no, they didn't ;)
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This is really just arguing semantics though, everything is paid for from the customers money.
 
Yamahahahahaha said:
It's not fine. If you take advantage of trading in the UK, you must pay the appropriate taxes. Public services do not appear out of thin air.

Structuring your business to pay the least amount of tax on the other hand is just good business sense. If the tax regime is allows it, then take advantage of it.
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Dont the business rates they get charged pay for the public services that the shops require, the jobs created generate employer and employee NICs and PAYE, and VAT is generated with every sale.
 
Yamahahahahaha said:
It's not fine. If you take advantage of trading in the UK, you must pay the appropriate taxes. Public services do not appear out of thin air.

Structuring your business to pay the least amount of tax on the other hand is just good business sense. If the tax regime is allows it, then take advantage of it.
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Yes, I was being sarcastic. But yes, paying so little Corporation Tax is fine, if you're making so little profit.

The point I was making (albeit badly) was that they should be paying tax on their profits made here before moving the money to the US.

Jokester said:
This is really just arguing semantics though, everything is paid for from the customers money.
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No, that's not true. Starbucks should be paying tax on the profit they make from selling their stuff to customers. That's their money, not their customers money. They also have to collect and pay their customers VAT. They're two different things.
 
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