... ask MNers to boycott Starbucks?

[legoballoon]

Personally, I won't be spending any money there again.

When I read the 'we pay our fair share of tax' statement, I almost choked on my (home made) hot chocolate. It's one law for the rich, another for us now is it?!

I think we should support small, UK-based independent coffee shops. Let's support businesses that generate wealth that is shared by local people.

4 of my local Starbucks employees' are immigrants - they have either married locals, or pay to live locally, spend any spare money locally, have friends & family to stay for holidays who then spend money locally... yes, an immigrant who lives locally is definitely as local as any other person!

Cinnabar - the main industry in my local area is the maritime industry; ie. yacht builders, yacht brokers, sailing clubs, yacht clubs, marinas & all the associated businesses there; boat engine manufacturers; even 2 naval regiments (not saying which) are based locally.
So by buying yachts (hopefully British built or brokered; or at least partly) that keeps local industry going here at least & keeps 1000s of people in work (my Dad & sister work in the maritime industry so i hope people don't stop buying boats & yachts either!).

Are immigrants not local people then? It's coming over a little Royston Vasey... a local shop for local people.

We'll have no shouting here

Is there a 'moral' amount of money that companies are supposed to pay? How do you calculate it?

Incidentally, you can leave school at 18 and start an apprenticeship in tax

And why are we all assuming that costa are doing nothing boycott worthy? I think this boycotting business sounds like hardwork.

Funnys - Are you..... local?

I agree with everything Rosieres wrote.

So because of the risk to the low paid, low skilled employees, we shouldn't boycott Starbucks? We should allow the company to keep acting immorally, for the sake of the employees?

I suspect that once they have paid any tax the owe, people would begin buying their disgusting coffees again, as its a matter of principal...

whoops principle :P

But they don't owe any tax so how would people know when they had paid it?

curious - but katykuns - how are the people that boycott starbucks going to work out the figure of how much money starbucks should pay to not be boycotted?

I think it is slightly more complicated than that Katy. Not least that many do not believe that they are acting illegally or immorally.

I am loving that most of the people intending to boycott don't actually go there.

I am going to boycott Primark, Boden, Centre Parks and mothercare. Plus anyone specialising in selling penis related products. And cat stuff.

I am not going to boycott Starbucks. They serve coffee at the time of day that I want to drink it. I've not yet come across an independent that does.

merrymouse, not sure whether your feelings are pro- or anti- Starbucks (solely with respect to what they've done tax-wise: as I've mentioned before I don't frequent them but that's solely because I prefer coffee from elsewhere), but your point is spot on: it is not for a howling mob to decide how much tax a company is liable to pay. That is decided by HMRC implementing Parliament's legislation, and calculated by the company's accountants in accordance with generally accepted accounting principles. If Starbucks were to increase the amount of tax it paid, short of writing a cheque for a few million to HMRC (which we have established HMRC would never cash), it would be required to run its accounts differently, i.e., "cook the books", which is illegal. Damned if they do, damned if they don't. And when companies get in that scenario they often decide to exit the market, and take the jobs with them. Between Costa, Caffe Nero and all the other independents I very much doubt there are 600+ stores' worth of jobs waiting to replace the closed Starbucks shops.

And I too thank Cinnabar for such careful and thoughtful sanity-restoring. Toombs, I also salute you, and all the others who have been whistling in the wind.

I am boycotting nero - I have been for three weeks now and all because they stopped doing almond syrup. It was an easy choice

I don't shop in Primark, Boden or mothercare and have never been to center parks

merrymouse, you have another spot on point about the likes of Costa: believe me, they structure their affairs all over the world (including in the UK) to be as tax efficient as they possibly can. And I don't fault them for it, necessarily, to the extent they are acting within the rules.

I think we have to get beyond the blunt instrument of "amount of tax paid" as the sole measure of corporate worth to the community. The media likes it because it makes a pithy headline, but it can be so misleading.

I am anti Starbucks' decision to stop selling date and banana muffins (this happened quite a few years ago and they never responded to any if my letters) but neutral about their tax situation. However finding thread amusing and informative.

Where my parents live, there is a "local" pub. My bro and I used to go to the quiz on a Wednesday night, so that was fine, until the one day we turned up for the quiz on a SUNDAY night. You have never seen such confused people.

Ooh, I never actually go to Primark, Boden, Centre Parks and mothercare, so can I claim I'm boycotting them and feel all moral about it?

WICKED.

mommybunny I like your post and hate to do this but given the lack of knowledge out there I would like to point out that generally accepted accounting practices (GAAP) are used for financial reporting purposes. You can use these records to calculate the tax owed but the rules around calculating tax are different to GAAP. An example is depreciation - US GAAP likes straight line over the useful life whereas tax rules (decided by Parliament and implemented by HMRC in the UK) normally dictate that the depreciation is greater at the start compared to the end of the useful life. Here in the US the tax rules are very firm when it comes to depreciation rates. It are these differences and tax credits to encourage certain behaviours that can result in the taxable income being very different to the net income shown on the financials.

Also, for those who are bleeting on about the stores being profitable... the stores might be profitable but the UK sub might not be. In accounting you have operating income/loss and net income/loss. It is perfectly feasible to have an operating income and net loss. When this happens the company normally looks to reduce their costs to create net income instead of a loss. In the case of Starbucks UK it was right that on an investor call this was addressed. The UK stores are profitable from an operating perspective but the UK operations are not profitable as a whole. As a shareholder I would want this to be acknowledged by management because why the heck would I want to invest in a company that thought it was ok to continue operating in a market where they were making a loss overall.

I think that it's more fundamental even than people not understanding the difference between an operating profit and an overall loss - there seems to be an assumption in the press that high sales must equate to big profits.

But if your costs are larger than your sales figure then you'll make a loss, no matter how many coffees you sell.

Want2bSupermum, thank you for the explanation - my lack of accounting knowledge is that glaring I see! My general point, and I think you got it, was that for Starbucks to calculate that it owed more tax, something somewhere in their financial records would have to be misleading. And that is a crime, a real crime for which people go to prison, not just "morally repugnant".

CinnabarRed I would be interested to hear about the £35bn tax gap (which is about £20bn evasion/fraud and £15bn avoidance) if you have time to post and others are interested too.

My ex-employer were a huge global company and I did wonder about the role of their accountants. Globally they would have paid literally millions in accountancy fees to one firm. That firm did as they were told an apparently independent audit each year.

Same firm had some high profile areas/countries that were high profit and they carried other departments/countries losses and took all our bonus money

want2bSupermum - if it was my business I wouldn't want to be operating in a market where I make a net loss. I would consider it imoral to have accountants trying to find ways to avoid paying tax, it might be legal, but then it shouldn't be.

Me me, I'm interested in the tax gap too!