Starbucks and their tax issues: Part 425
British Chief Executive Mark Fox said the giant chain's UK operations are likely to be profitable within three years, however until Starbucks returns to profit, corporation tax is not applicable.
Fox reckons it's nothing unusual, but did find it odd that the chain had yet to make a profit from the average £3.50 a coffee.
Tax avoidance is nothing new with Starbucks, when it emerged two years ago that it had only paid £8.6 million in corporation tax, despite a £3 billion in the bank since it first infested the UK in 1998. Back then it was accused of funnelling profits through the Netherlands because lower tax. They're still under investigation for that.
Fox has admitted to the Evening Standard that Starbucks had been damaged by the tax row, but insisted that Starbucks' tax affairs were very, very ordinary. He said: "It happens across the sector and therefore it didn't bother me at all."
"There was nothing abnormal about the way Starbucks is run in the UK. What is abnormal is that we haven’t been making a profit," adding: "I look at the business now with eight quarters of growth, I don’t see a damaged brand, I see a brand that is starting to regain its mojo."