* UK sales fall after 16 years of strong growth
* Saw consumer boycotts after criticism of tax payments
* Has announced plans to move Europe HQ to London
By Tom Bergin
LONDON, April 24 Starbucks suffered its
first ever drop in UK sales last year, a period when the company
became the subject of boycotts and public criticism over its tax
Accounts for Starbucks' main UK subsidiary, Starbucks Coffee
Company (UK) Ltd, showed turnover fell in the year to the end of
September 2013 to 399 million pounds from 413 million pounds in
the previous year.
The drop follows 16 years of consistent and strong growth,
and comes despite the business "being supported by an improving
economic environment" the accounts said.
Starbucks was not immediately available to comment on the
accounts and why UK sales fell.
The U.S.-based company triggered a media storm, store
pickets and customer boycotts after Reuters reported in October
2012 that Starbucks had told the UK tax authority its British
arm was a loss-making business while informing investors that
the subsidiary was profitable.
Corporate tax avoidance has risen to the top of the
international political agenda partly as a result of public
anger at Starbucks tax affairs.
The company was asked to testify to a parliamentary
investigation and Prime Minister David Cameron told a meeting at
the World Economic Forum in Davos that companies that avoided
paying tax needed to "wake up and smell the coffee".
In response to the criticism, Starbucks agreed to pay 20
million pounds in tax over 2013 and 2014. It has already paid 15
million, the accounts said.
The company has said it follows all tax rules.
Starbucks Coffee Company (UK) reported a loss for the year
to September 2013 of 20 million pounds, after deducting
inter-company payments such as royalties for the use of the
Starbucks brand, which the company agreed in 2012 not to deduct
for tax purposes.
Last week, Starbucks said it would move its European
headquarters to London from the Netherlands this year and pay
more tax in the UK as a result.
Reuters Special Report on Starbucks Tax Affairs:
(Editing by Susan Fenton)