‘Immoral’ business: Google, Starbucks, Amazon grilled over UK tax avoidance

Top US corporations faced tough questioning by British MPs who accused Google, Starbucks and Amazon of leaking tax revenues from the UK to tax havens abroad, labeling their actions as “immoral.”

On Monday, lawmakers questioned the three business goliaths’ key executives on how exactly they managed to pay so little tax while making billions on the British market.

“We are not accusing you of being illegal,” Public Accounts Committee chairman Margaret Hodge said as quoted by The Telegraph, “we are accusing you of being immoral.”

It has turned out that Starbucks has paid no corporate tax in the UK in the last three years. The coffee chain paid only £8.6 million (US$10.8 million) in total tax to the UK government over 14 years. It has also been disclosed that Starbucks signed a secret deal in the Netherlands in order to pay a discounted tax rate there. The company maintains its European headquarters in Amsterdam, where it employs 220 people, compared with 6,500 in the UK – which raises questions about where its economic activity is really concentrated.

Meanwhile, in response Starbucks denied the allegations, with its finance chief Troy Alstead saying the company has been making no money in Britain, yet vowing to pay more taxes once it became more profitable.

Amazon, the UK’s biggest online retailer, was accused of “manipulating profits” by Labour MP Fiona MacTaggart, who claimed the company was deliberately structuring its UK arm "to make it pretend that it is just warehousing." The company employs 15,000, with its warehouses in the UK, but drives all of its sales through Luxembourg. “Your entire business is here but you pay no tax here, and that really riles us,” said Hodge, as quoted by The Telegraph.

Google was accused of paying only an effective 0.4 per cent tax rate in the UK, compared with 21 per cent paid globally. Conservative MP Charlie Elphicke stressed that Google’s tax charge in Britain was only £3.4 million (US$ 5.4 million) out of declared earnings of £2.5 billion.

“Billions of tax revenues are being lost to the UK. It's clear from today that international tax avoidance is being conducted on an industrial scale. This is not just unfair on hardworking, honest UK taxpayers. It gives overseas companies an unfair competitive advantage over UK companies. That's bad for our economic growth,” Elphicke said.

"The tax abuse can be stopped. We can tighten UK tax presence rules, we can stop the 'expenses' used to cut business tax bills in the UK, and we should refuse government contracts for companies that don't pay a fair share of tax in the UK."

Lord Myner, the former City minister, said large international companies took in massive amounts of money in the UK but ensured they made no profits by carrying out large payments to offshore companies, as corporate tax is only paid on profit.

The fact that the American giants leeched off the system in the UK has provoked public concern in the wake of the austerity measures implemented to make up for large budget shortfalls in Britain and Europe at large.


http://rt.com/news/google-starbucks-amazon-uk-556/

Why do you think dumb tabloid press keep running non stories, about some exceptional case in which a women scammed £10k from welfare?

Why, to keep your short attention span away from the true thieves and global scale hucksters.

 

Luxembourg isnt overseas

 

So Britain gets tax revenue from every sale that these companies make, from everything they purchase and from the property that they own from the wages they pay their employees and from the dividends they pay investors, but they are immoral for not paying "enough" corporate income tax?

 

I think the point was that they're not paying what their competitors are having to pay.

 

it is from britain

 

of course they are, it says youre in germany but imo you must be american to say something as stupid as that.

 

what we should do is calculate their earnings over that period of times, go back 15 years, estimate profit, form a tax bill based on that paying the full rate of corporation tax, then give them the bill tell them they have 3 months to either pay it in full or close all outlets in the uk and leave forever, then you would find they would be willing to talk turkey.

 

we can just take over their businesses keep people employed in starbucks etc, either hand them over to costa coffee or allow people who want to open a small business to take over a starbucks outlet for free

 

Are UK rock stars or pensioners immoral for fleeing UK taxes?

 

Depends.

I have NO respect for Sean Connery, for instance.

 

That sounds like a great idea. In fact, they should pull out right now, firing every one of those workers. The UK would be far better off to lose thousands of jobs and billions in tax revenue, just to stick it to those "evil corporations". They paid what they were legally required to pay, if you don't like it, get the laws changed.

 

erm...have you not noticed the problem is we're getting practically zero tax revenue from several of the biggest companies in the world ? lose billions lol, and it amounts to maybe 25 000 jobs, most of which could be replaced, in a state of about 65 million people thats no big deal. we will be changing the laws, and they didnt pay what was legally required they moved profits offshore, we cant control the laws of other states. and they wouldnt be pulling out Im saying kick them out.

 

absolutely, though pensioners dont do that

 

U2 got a lot of grief for moving to the Netherlands. Granted, they're from the Republic of Ireland, not Northern Ireland.

 

why do americans always defend corporate tax evasion ? you really are a warped race, they have done you lot up like a kipper they even control your minds now its amazing.

 

It never ceases to amaze me the number of dopes who will blindly defend corporate greed.

Why?

 

also vermin, bono spends half his life going on about poverty hunger third world debt yet evades tax that would help alleviate some of these things and once paid 40 thousand pounds to have his favourite hat flown halfway across europe

 

Aren't U2 pensioners?....Joke.

 

its just america, theyre dumb and brainwashed, mostly. there are exceptions like serfinusa but youre talking 95% of them are just brain dead morons who say and think what theyve been taught to.

 

and u2 didnt move to the netherlands, they still live in ireland, they just relocated their management company there, so technically they get paid in holland now so they pay tax at dutch rates. which makes it even more immoral, they are happy to use irish services but not to pay for them.

 

Money became their manna, and corporations their gods....

 

I have the same opinion about bigots, not a smart lot.

 

nothing bigoted about it, its just my experience of interacting with tens of thousands of americans. the vast majority are thick as pig(*)(*)(*)(*) and the most ignorant people on the planet.

 

The corporate income taxes are only one of many taxes that the UK collects from these companies. They still collect sales, property, income and capital gains taxes from these companies.

 

ten of thousands???? even if I could swallow that gross exaggeration we currently have over 300 million citizens.

Perhaps you should look up the definition as you drove my point home with this post. Making assumptions about entire groups of people based of a few personal experiences is exactly what bigots do.