Are Starbucks “Good to Go”?

Looking through an old newspaper I found an amazing story about Starbucks and their secretive company structures. On 4 December 2012 the Guardian reported that had paid out on £8.6 million in UK tax on thirteen years of sales, totalling £3,100 million - that's just 0.3%

It seems that on Monday 3 December 2012 they told Parliament's Public Accounts Committee that for 14 of the 15 years Starbucks has been operating in the UK, they had made a loss. Strange, given their 31% market share and their announcement elsewhere that the UK business was making 15% profits (presumably GP on R).

Despite a promise by Starbucks on the preceeding Saturday (1 December 2012) that they would open talks with the Government about paying more tax, the House of Commons Committee was not impressed. They branded Starbucks tax avoidance practices as "immoral".

Well, what happened next? According to the Guardian, on the same day as the Commons appearance, new contractual terms were circulated to their 7000 staff removing entitlement to a number of bonuses and incentive payments. A spokesman said this was "unrelated to their discussions with HMRC and the Treasury". Clumsy PR? Certainly. A Coincidence? You must decide for yourselves.

But two key questions do remain. If Starbucks really have been losing money over the last 15 years (rather than indulging in trendy corporate accounting) then when are they going to give up and move out? Or alternatively, if they are in fact making money, then when are they going to pay a fair rate of tax to a country where they do well?