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Starbucks HMRC Tax

Starbucks makes first corporation tax payment to HMRC since 2008

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By Gillian West, Social media manager

June 23, 2013 | 2 min read

Starbucks has paid £5m in corporation tax to HMRC, its first payment since 2008.

The payment is for the first six months of 2013 despite the coffee chain making an annual loss of £30.4m in the UK. A further payment of £5m is expected in the second half of the year.

Starbucks annual report, which is due to be published this week, will reveal the extent of the chains losses and will show how the company has started paying back the £20m it promised to pay HMRC over the course of two years in 2012.

The news of the tax payment aims to show that the American company has responded to the criticism it received last year for making licensing and supply agreements with the Dutch and Swiss divisions of the business to avoid paying tax in the UK.

Despite high levels of sales Starbucks insists that the UK operation is loss-making with the chief executive of Starbucks Europe, Kris Engskov, closing a number of stores to try and turn around the UK business. Between 25 and 30 branches in 'less lucrative locations' are expected to close this year, with 30 stores closed in 2012 and relocated to less expensive sites.

Engskov has said he hopes to return the business to profitability within the next three to five years, claiming that the last time the business turned a profit in the UK was five years ago in 2008, when it last paid tax.

Google and Amazon have also faced criticism for the low amounts of tax they pay in the UK.

Starbucks HMRC Tax

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