{"id":52896,"date":"2020-09-17T08:55:07","date_gmt":"2020-09-17T07:55:07","guid":{"rendered":"https:\/\/www.taxresearch.org.uk\/Blog\/?p=52896"},"modified":"2020-09-17T08:55:07","modified_gmt":"2020-09-17T07:55:07","slug":"tax-and-opacity-remain-at-the-heart-of-starbucks-operations","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2020\/09\/17\/tax-and-opacity-remain-at-the-heart-of-starbucks-operations\/","title":{"rendered":"Tax and opacity remain at the heart of Starbuck\u00e2\u20ac\u2122s operations"},"content":{"rendered":"

As the FT has reported<\/a> this morning:<\/p>\n

Starbucks\u2019 European division paid $175m in dividends to its US parent company last year, despite recording a 99 per cent fall in pre-tax profit as it spent heavily on developing more takeaway and drive-through services.<\/p>\n

The company revealed in the latest accounts for its UK and European business that pre-tax profit fell from $99.5m in 2018, to $600,000 in 2019, as it incurred costs restructuring its operations, closing underperforming stores and investing in new formats. Its UK subsidiary reported a loss of \u00a36.6m because of \u201cdifficult conditions on the UK high street\u201d, it said.<\/p><\/blockquote>\n

And as I noted in the same article:<\/p>\n

\u201cWhat these accounts tell us is that there is still remarkably little [we know] about how Starbucks is making profits,\u201d said economist and tax campaigner Richard Murphy. He said that while there was no evidence of tax avoidance there was a \u201cstrong tax motivation\u201d in the way Starbucks managed its finances. He suggested the company publish \u201ccountry by country accounts\u201d.<\/p><\/blockquote>\n

In response Starbucks was noted as saying that it is\u00a0\u201cin the process of simplifying its accounts\u201d.<\/p>\n

But as I told the FT, that\u2019s not what we are asking for. If complexity is necessary, so be it. That\u2019s a commercial decision for Starbucks. What we are asking for is a simple statement of \u00a0account - which Starbucks already prepares for tax purposes - \u00a0that show, in total and on a country consolidated basis, what sales it makes, what profit it makes, and what tax it provides for and pays in each country where it operates. Add in data on county investment and on employment and the information required to appraise whether or not both profits and tax are likely to be fairly stated by country.<\/p>\n

Starbucks knows what is required. They\u2019re choosing not to do it. And as a result I still do not trust its accounting.<\/p>\n","protected":false},"excerpt":{"rendered":"

As the FT has reported this morning: Starbucks\u2019 European division paid $175m in dividends to its US parent company last year, despite recording a 99
 Read the full article…<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[26,79,35,97],"tags":[],"class_list":["post-52896","post","type-post","status-publish","format-standard","hentry","category-accounting","category-country-by-country","category-economics","category-tax-justice"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/52896","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=52896"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/52896\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=52896"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=52896"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=52896"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}