On our way to a meeting, in central London. “We’ve got some time, shall we have a cup of tea first?” I asked my colleague. Thus began our gently Right-wing, middle-class, tea-consumption dilemma.

For we were standing outside Starbucks, next to Goodge Street tube. Jon laughed: “Oh no! Can we buy our tea from those ferocious tax dodgers?” “The morality of tax is one thing,” I said, asserting my seniority, “but their Earl Grey is much better than Caffe Nero’s.”

Perhaps fortunately, Starbucks was star-bursting to the seams with Bloomsburyites, sublimely indifferent to the suffering caused when multinationals pay only the legally sought amount of tax.

We should have loitered on the street, just for a bit, because by the time we’d forced down Caffe Nero’s seemingly bergamot-free Earl Grey, Starbucks had agreed to pay about £20 million more in tax – Bloomsbury’s liberals can stop pretending they drank this morning’s coffee with equanimity. And I needn’t fear the company will find the £20 million by cutting back on the my favourite tea flavouring: the payments will be funded by not claiming “tax deductions for royalties or payments related to our intercompany charges”, according to a spokesman, speaking to the BBC.

It’s easy (and correct) to laugh at Jon and I, worrying about where to buy our tea. Starbucks’ employees have more immediate concerns to worry about – it seems that the company can no longer afford to pay them for a lunchbreak; and if we all boycott this new Espresso Satan, what will happen to those employees? More work, or less?

And why shouldn’t companies minimise their tax bills? I’m a company: payment for this blog is made to Graeme Archer Ltd. I deduct legally permitted amounts from the vast cheque I write HMRC, all agreed between the state and my accountant. Should I feel guilty about this?

Of course not, no more than the non-Ltd form of Graeme Archer worries about paying into his ISA. But neither Graeme Archer Ltd, nor its sole physical manifestation, are multinational corporations (not yet). And it was the claim by Starbucks that it made precious little profit on its UK operations that drew the sharpest gasps of disbelief at the company’s parliamentary grilling. Multinational entities can do what the rest of us cannot – shove a bit there, move some more over here (remember those “intercompany charges” that proved so usefully deductible) – and so (perfectly legally) reduce their tax bill.

Again: why not? I’m not a supporter of some demented Marxist sect. But there’s something … unprepossessing about this PR move by the coffee giant.

After all, if it truly believed that it should pay more tax, why not simply pay corporation tax on its UK income? I don’t say that should do so; only that if one feels that multinationals should pay tax on their income, that seems the logical way to go. Rather than an arbitrary sum, tossed to the media in a hope to buy-off the liberal storm.

There's a Belle & Sebastian song I like, called "For the price of a cup of tea". Twenty million pounds is an expensive price for the moral license to sell tea, admittedly. But I don't think it will prove enough. Lashings of bergamot oil notwithstanding.


Source: http://www.nigeriakitchen.com/index.php?topic=41.0