| LONDON, June 28
LONDON, June 28 Starbucks, whose thin tax
payments in Britain provoked a backlash against corporate tax
avoidance when revealed by Reuters, paid no tax for the year to
Sept. 30, 2012.
The coffee giant's main UK subsidiary reported its 15th
straight annual loss at its UK stores in accounts filed on
Reuters revealed in October that Starbucks reported
consistent UK losses while telling investors the British unit
was profitable and promoting managers of the unit within the
Friday's accounts showed a UK loss of 30 million pounds ($46
million), down from the 32 million pounds loss it reported for
the previous year, helped by a 4 percent rise in turnover to 413
The company cited challenging economic conditions and a
competitive UK coffee market, although the accounts show profits
were also undermined by a royalty for the use of the Starbucks
brand of 26 million pounds.
This is paid to an affiliate in the Netherlands, where
Starbucks has negotiated what it said was a very low tax rate.
The UK unit also paid 2 million pounds in interest to
affiliated companies, the accounts showed.
Following widespread criticism from politicians and the
picketing of stores, Starbucks said it would pay or pre-pay
around 10 million pounds a year in taxes in 2013 and 2014.
The company said it would not take tax deductions for
certain intercompany payments such as the royalty fee, interest
payments and the 25 percent mark up on coffee beans that is paid
to a Swiss-based Starbucks coffee purchasing unit.
Starbucks recently paid 5 million pounds to the UK tax
authority as the first instalment of its 2013 tax bill, British
media reported earlier this month.
Starbucks declined immediate comment.