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Posts Tagged ‘Starbucks’

Where is the tax justice in our economy?

10/12/2012, 01:28:03 PM

by Amanda Ramsay

When it comes to the economy, George Osborne has failed this country on all levels. He’s failed on debt reduction, on deficit reduction and failed to bring growth or jobs. The price we pay is cuts to our services, employment rights and employment prospects.

The Autumn financial statement poured more cold water on Keynesian hopes, eager for a “do something government,” not a laissez-faire-do-nothing-but-cut-government. Yet in the morass of commentary and analysis since the chancellor sat down last Wednesday, I am still asking myself: why is it acceptable that tax payers end-up subsidising low wages by means of tax credits, housing benefit and all manner of other fiscal instruments to supplement people on poverty pay?

I ask this not because the recipients don’t deserve the help they need to make ends meet, of course they do, but they are only necessary because employers and companies are not paying adequate salaries and wages in the first place.

Someone who has the gumption to start a company and create jobs should be congratulated and supported but without a mandatory living wage, companies are allowed to let profit win over decency in how they pay their staff.

Low pay is forcing people into the arms of the nanny state; to house, feed, clothe and pay for transport to get themselves to work, let alone heat their homes.

Where’s the fairness in that?

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The Sunday review: Starbucks

09/12/2012, 08:00:58 AM

by Anthony Painter

I imagine the first Starbucks store that opened in Pike Place market in Seattle was quite an exciting affair. The coffee was probably great. It must have been a remarkable local institution. Four decades later, Starbucks is now synonymous with corporate greed. What a few weeks it’s had – a long way from Pike Place.

What has taken place shows that direct action works. No, not UK Uncut. But that of MPs. Step forward Margaret Hodge, a name mostly associated with New Labour. Who’d have thought it? But when a special report appeared on Reuters in the middle of October, it was the House of Commons public accounts committee that reacted. A few weeks later and Starbucks is £20 million out of pocket. Investigative journalism and a backbench House of Commons committee – it doesn’t get much more old politics than that but it did the trick.

Starbucks seem pretty par for the course when it comes to multinational tax avoidance. In this case, moral outrage seems to have done the trick as thousands turned away from Starbucks, helped by campaigns such as 38 Degrees (UK Uncut have a habit of putting people off rather than encouraging them to join their campaigns – whatever the claims of the direct action left or paranoid right). But moral outrage only goes so far. Starbucks will be hoping it’s all died down in a couple of years and then get back to business as usual.

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We need to take action on the tax shirking oligarchs of the internet

07/12/2012, 07:00:20 AM

by Dan McCurry

Rather like in ancient Rome or the end of the Soviet Union, the sudden expansion of the internet has produced a small number of oligarchs controlling a huge amount of industry.

It was only a matter of time before the moral and ethical questions began to pile up. Initially, they destroyed traditional industry with little or no objection from policy makers or the public, as this was a new and super-efficient way to market goods and services, and we must not stand in the way of progress.

But then the abuse allegations began to mount. Google is accused of using its search engine to guide traffic towards its own services rather than that of its rivals. Amazon is accused of using its dominance to bully publishers. Apple dominates downloads of music and other digital content, creating questions on the state of competition.

Then we discovered that Google and Amazon were using their ability to cross borders unchecked as a tool to avoid tax, and therefore have an unfair advantage over the existing competition.

In fairness, the multinationals invented the rules that the internet giants appear to be feasting on. Starbucks claims to make no profit due to the huge amounts of royalties it has to pay to its subsidiary in low-tax Luxembourg. The royalties are for the right to use its own logo.

Maybe Starbucks should drop serving coffees and stick to its core business of charging customers for a napkin with the logo on. The customer can sit down at a table, with their logo embossed napkin and stroke it for 20 minutes before leaving? Their position is so absurd it’s no wonder that after a modicum of public scrutiny they have volunteered to pay more tax.

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Forcing the likes of Starbucks to Pay Where You Earn would help tackle tax avoidance

22/10/2012, 04:23:50 PM

Last week Phil McCauley won the “top of the policies” vote at Pragmatic Radicalism’s event on industrial policy. The winning proposal tackled the question of reducing corporate tax avoidance

I believe we must act to end tax avoidance. We have seen numerous examples of famous brands proudly paying very little tax; just last week it emerged that Starbucks have a grand total of £8.6m in corporation tax in this country over the last fourteen years.

Once again, as the spotlight has been shone on an embarrassed corporation, we’ve seen a litany of familiar excuses wheeled out to excuse not paying their fair share. This time, as well as the usual “we’ve done nothing illegal” line, part of Starbucks defence was that they paid their fair share of tax via national insurance contributions for their employees! This assumes away the entire basis of corporation tax (e.g. on companies’ profits) and sells every other tax payer short – company and individual alike.

Starbucks disgraceful tax avoidance will not be the last revelation of this type, and unless action is taken, we will continue see yet more billionaire entrepreneurs seeking plaudits whilst legally robbing the exchequer.

For years, all governments have failed to rebalance our taxation system. My proposal involves a new approach that requires legislation from the next Labour government and which represents a radical shift away from the failed approaches of the past.

It’s time for pay where you earn.

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