Starbucks: Let them Drink Tea
Oyez. Oyez. Oyez.
Hear-ye. Hear-ye. Hear-ye.
Hear me. Hear me. hear me.
Insofar as, Starbucks having been declared to be Tax Avoiders by the Court of Planet Mars, i.e., the Marsupial Court, and failing to note that they may or may not be guilty of that offence, we hereby celebrate that the Boycott of Starbucks has been a success, and rejoice along with Costa Coffee:
Rival chain Costa Coffee has seen its sales boosted by a whopping 6.8% recently while Starbucks has become mired in controversy.
Andy Harrison, chief executive of Costa owner Whitbread, told the Financial Times this week:
It is difficult to define the impact of [the Starbucks tax issues] into the figures, but we remain the UK taxman’s favourite coffee shop… Starbucks has taken a bit of a knock.
It was recently revealed that Starbucks paid no corporation tax in the UK over the past three years, and just £8.6m in corporation tax in 14 years of trading in Britain.
Further we note that Costa Coffee and Whitbread plc are a moral corporation, in contrast to Starbucks, who are immoral, evil, Yankee-Doodle Capitalists:
Industry insiders say Costa is even mulling over using the fact that it pays British taxes in full as an advertising strategy.
It looks like Britons are increasingly getting fed up of tax avoiders too.
A battle has been won, Comrades.
(Now for the difficult bit.)
However, history records that on 24th October 2010 our well-beloved Liberal Conspirator and Wise-Woman of the Parish Mistress Kate Belgrave did declare a solemn Boycott of Costa Coffee, as part of the evil Capitalist Behemoth … er … Whitbread plc.
Last week, 35 deluded business leaders wrote to the Telegraph to praise George Osborne’s vicious spending review.
I’m joining those who have decide to boycott every single company that those business leaders represent.
Whitbread were anathematised for their immoral support for the authenticity of the Book of Gideon expressed in a letter to that Media Capitalist Front, the Daily Telegraph:
… each writing in our personal capacity, we would encourage George Osborne and the Government to press ahead with his plans to reduce the deficit.
In the long run it will deliver a healthier and more stable economy.
…
Anthony Habgood
Chairman, Whitbread
Chairman, Reed Elsevier
This, to be frank, leaves us with our heads inserted in our own Large Intestines to an Infeasibly Large Extent, our buttocks covering our ears so that we cannot hear ourselves making a series of farting noises.
Those who have held faith with our earlier boycott must now reverse your position, particularly if you have been patronising Starbucks so as to avoid Costa Coffee and their connection to Whitbread plc.
In other words, life is more complicated than is convenient politically.
Sorry.
Any pain, anxiety or confusion that you have experienced in the meantime is undoubtedly good for your soul.
Alternatively, you can switch to the fruit of the vine, or tea, and drown your sorrows.
December 14, 2012 at 09:18
-
Apart from the fact that all the coffee is vastly over-priced (my father
ran a successful Cafe in Putney in the 50′s and he made a healthy profit by
selling food etc at 100% more than he paid for it!), there are three points to
consider here.
Firstly, as I understand things a lot (all?) of the
Starbucks in the UK are franchises. Presumably each franchise makes a “profit”
and therefore pays Corporation Tax. Whilst Starbucks may suffer later on, the
first to be hit by any boycott will be the franchisee. If they go bust
Starbucks will just find another to take their place. As Starbucks do not make
a “profit” they will not be unduly affected by the loss of turn-over.
The
second factor is the definition of “profits” for Corporation Tax. The Tax is
not based on Turnover. It is based on “profit”, and not “profit” as you and I
know it, but “profit” after all sorts of allowances have been deducted. Thus
interest paid on a loan is tax deductible, as is a “provision” made for future
(i.e. not yet actually incurred) losses. Thus if you look at the balance sheet
of most (all?) large companies you will find that the amount of Corporation
Tax paid on is far lower than you might expect. It has been like this for at
least the last 40 years (when I went on a course for Non-Financial
Managers).
Finally, it has always been the case that Corporation Tax is
paid where the company is based, so if you buy goods and services from a
company based in Peru the costs will be deducted from your Corporation Tax
calculation and the “profit” added to theirs.
Two suggestions for solving
the problem:
1. Levy a Sales Tax on all sales, payable at the end of the
Financial Year and to be offset against calculation of UK Corporation Tax
or
2. Abolish Corporation Tax on “profits”, so the money stays in the
company, and levy a Dividend Tax on all and any distribution of profits to
shareholders etc.
The elephant in the room, far bigger than Corporation
Tax, is where does the Value Added Tax on “foreign” invoices go?
December 14, 2012 at 13:16
-
It’s mainly a geo-location issue, and tax regimes which allow
organisations to shuffle around their legal domicile, income, and costs to
ensure that their profits ‘show up’ (or be accounted for) in the most tax
beneficial end point. For instance,
Corporate tax incidence
http://en.wikipedia.org/wiki/Transfer_pricing
VAT status and location
http://www.guardian.co.uk/technology/2012/oct/21/amazon-forces-publishers-pay-vat-ebook
Sure, it’s the art of making sure you pay as little tax as possible but,
potentially, it is now being manipulated in such a way, that it ‘cheats’ the
economy in which you generate the profits from what their community deems to
be a fair share, as set by its own tax regime. The sums of money involved
are now getting to be material
If you don’t try to mitigate it, or don’t believe it should even matter,
eventually the street lines won’t go on at night
December 14, 2012 at 08:23
-
I ‘may’ have misunderstood the whole “Coffee Thing” – Various UK Government
Officials and/or Ministers made errors in drafting (Company)Tax Law – and now
believe that the business involved should have pointed this out, done the sums
for them, and paid over more than they needed to?
[Personal statement- I
prefer TEA “NATO-Standard”]
December 13, 2012 at 22:52
-
Can’t be bothered I am a Tea Freak.
December 13, 2012 at 22:45
-
Businesses do not exist to pay taxes. Nobody goes to work in the hope of
paying taxes. Taxes are legalised theft. If a business makes a loss, or does
not make a profit then no tax is due. I have read that Amazon does not make a
profit. It is a strange predatory operation which is expected to clean up one
day by its investors, but apparently presently doesn’t turn a profit. It is
not due to pay Corporation Tax on its sales ( it pays VAT on that, or rather
we do, cos we dont get to recover input tax at this end of the food chain ),
unless it makes a profit.
I am heartily sick of all this witch hunt lefty crap. Just as its a stupid
welfare system that can be ripped off, equally its a stupid tax system that
lets businesses pay ( or not ) taxes in other jurisdictions on profits earned
in the UK. However, the tricks are so numerous that essentially whatever the
government does, the paying of taxes by multinationals anywhere is pretty much
optional.
Starbucks never did impress me much. They do a kind of coffee slush puppy
thing which I have imbibed on a hot summer day, but I don’t think their
general offering beats a good Italian Cafe. However, offering to pay a “tax”
which is basically a bribe, or marketing expense is cynical. Either stick to
your guns and maintain that no tax is due, or put your hand up and pay what
you “should” pay. Offering Gideon a Lotto Jackpot without ticking the no
publicity box makes me wish I was a regular customer so I could boycott them
too.
December 13, 2012 at 21:43
-
As an espresso man for preference, trained in Parma, confirmed in
Catalunya, I’ll make my own, thank you.
Who wants a bucket of bad coffee
anyway?
Even so, had a superb coffee in Lombardi’s in Chesterfield last
weekend.
December 13, 2012 at 20:39
-
No… I make a serious point.
I am pretty a*al about coffee, I use a spring lever commercial espresso
machine in my kitchen, I hand-grind single origin espresso coffee beans and
make some pretty good coffee. However sometimes one needs to meet someone
outside and a coffee shop is ideal.
Instead of messing around with trying to catch each other out, or dis
someone else’s business in some way, if one of them could sell consistently
good cheap coffee, instead of these vast flagons of milky slop, they would run
away with all the prizes.
Other than that there are a about twenty good coffee shops in London and
perhaps a few less in England, so perhaps I should consider Naples…. Or…
- December 13, 2012 at 20:42
-
Given the a*al preference, do you rate the elephant or monkey variety to
be the better?
- December 13, 2012 at 20:44
-
BTW, if there are less in England than in London, are you in Ontario?
- December 13, 2012 at 22:14
-
No… London, England, Great Britain.
Just that London has very few and England as a whole has not much more
to add. However, as binao adds below, I am probably over-egging the p,
they just need hunting down, they are definitely not the norm.
December 13, 2012 at 21:36
-
Down our way, ‘connected’ people picked up secondhand machines from Costa
the other day for £30.
December 13, 2012 at 19:22
-
I’m just waiting to find out which politicians (and their families) have
major investments in the companies (or their parent companies) to figure out
just why this is going on. What’s the betting Costa has more politicians (and
donors) investing in their stock than Starbucks? I think that’s a guaranteed
certainty, don’t you? (although I think Starbucks support of the concealed
carry laws in the US probably ‘irritated’ a few of the champagne socialists
too, is this some payback or have they upset someone by not donating enough –
back-handers anyone?).
December 13, 2012 at 20:40
-
Not guilty – I sold my long-held tranche of Whitbread shares before this
current Costa opportunism arose.
Trouble is, I sold them at less than £7 – they’re almost £25 now – bugger
! Like sex and comedy, it’s all about timing, and my timing’s about as bad
as it gets.
- December 13, 2012 at 20:48
-
Just proves long isn’t everything
December 13, 2012 at 19:18
-
In England it is almost impossible to buy decent coffee without taking out
a mortgage.
All the cheaper stuff is sour and bitter with lots of caffeine
but little magic.
In Spain there was cheap coffee one could buy in the
supermarkets that was brilliant.
Sometimes I wonder why.
Mainly I have
just resorted to instant from Aldi.
- December 13, 2012 at 20:40
-
Nor, in the UK, do we generate the volumes of elephant dung, or monkey
poo, required to economically produce reasonably priced beans of enhanced
quality and taste. Of course, that does assume that you have an all too
understandable aversion to being even tempted to try sampling the average
Daily Mail reader’s output, which is manifold, without any obvious limit,
and unutterably cheap
- December 13, 2012 at 22:05
-
Don’t get too many elephants in Spain, you poor deprived soul.
December 13, 2012 at 18:23
-
Why don’t all these complaining people make their own coffee at home and
take it to the office/park bench/library/nursery/benefits office themselves?
Better, how you like it, and certainly cheaper. Also, if your thermos is a
large one you can offer to share….
- December 13, 2012 at 17:23
-
Interesting to read about how these corporate giants compete with each
other Anna, but I have got a different agenda…
Does anyone know where I can get a (drinkable) cup of coffee?
December 13, 2012 at
17:53
-
MacDonalds. Honestly, it’s true. At least over her in the not so frozen
North. MacDonalds make seriously decent, drinkable (And much cheaper)
Coffee.
- December 13, 2012 at 18:08
-
McDonalds do the same here
December 13, 2012 at 23:17
-
Totally agree Bill the only decent thing form McDonalds is the coffee
and here in Canada it is free for seniors (55+) a couple of days a
week.
December 14, 2012 at 03:10
-
The MacDonalds in Paris have patisseries as well, fantastic, I
discovered them when working out of a Paris suburb, just as I got to
appreciate how good they were, they shipped me out to Ukraine bah!
December 13, 2012 at 16:28
-
Select committees that stir up the mob might find the mob turns on
them someday. The foregoing is a historical observation, not an incitement to
action nor is it intended as a libel against any person or persons living or
dead. This post may not be re-posted, tweeted, re-tweeted, linked to or used
in any way not intended by the author without the express permission of the
author. [Does that cover all the bases? Life is tough isn’t it?]
December 13, 2012 at 16:06
-
Now this little piece explains a lot to me. Living in France as I do I am
accustomed to almost universally good coffee. Recently I visited England for a
few day and on one occasion found myself with a choice of coffee vendors,
Starbucks or Costa. Benig aware of the former’s tax payment controversy I
decided to boycott that outlet and opted for their rival. Coffee? Never! The
only association with that fragrant beverage was in the name of the company –
Costa Coffee. The offering of a small café latté was warm, insipid, almost
tasteless and unacceptable to my palate. Having read Anna”s current article I
can now understand why this was so – the parent company is Whitbread who
cannot brew a decent beer with any semblance pf something which tastes like a
good beer should,they obviously apply common brewing techniques to both
products.
December 13,
2012 at 15:33
-
I refuse to pay the insane prices charged by any coffee shop for what is,
after all, a cup of coffee. Tony Hancock put it best, “I don’t want the froth
because I want something to drink, not wash my clothes in”.
As for
Fairtrade, as far as I’m concerned, if they make me a cup of coffee and I pay
them, that’s fair trade.
- December 13, 2012 at 15:11
-
I am going to down to the winehouse to see if they have anything that can
help me make any sense of post. As well as contribute a little more to the
national coffers to ensure that Starbucks, Costa and Whitbread staff can still
have access such things as basic health care, even if their employers
won’t.
-
December 13, 2012 at 19:00
-
This particular Winehouse is at 4, Discus House, 6 St. Thomas Street,
Town Centre, Sunderland, SR1 1QD.
- December 13, 2012 at 20:52
-
Can Apple Maps find Sunderland?
December 13, 2012 at 14:23
-
I lack the moral fibre necessary to refuse damn good coffee. Hit me one
more time, Starbucks!
December 13, 2012 at 16:05
-
Is the Starbucks coffee in the UK damn good? I have only tried it in the
US, and from what I remember their standard coffee was bitter and weak. I
also tried their mocha and was not very impressed. I like a good cup of
coffee and usually brew it in an aluminium stove top percolator and then
make the hot milk from powder separately and whisk it to a froth in a
blender. Occasionally make mocha, but there is a local brand of coffee beans
here in the Dominican Republic called Monte Real (Royal Mountain) that has
some cocoa beans roasted together with the coffee beans and has a delicious
aroma of chocolate without really tasting chocolatey. The drinks I had in SB
were crap and since I can’t stand anything with a flavoured syrup added to
the coffee, they don’t have much to offer me. They are often mentioned as
serving “gourmet coffee”, but it doesn’t seem very gourmet to me.
- December 13, 2012 at 16:38
-
I agree Starbucks is a little bitter and I share your dislike of added
syrup/chocolate flavours, Jonathan. I must sample your connoisseur blend
‘Monte Real’.
December
13, 2012 at 13:16
-
“we remain the UK taxman’s favourite coffee shop”
Right, so I’m already boycotting Starbucks for cravenly giving in and
coughing up. Now I have to boycott Costa for that comment.
At least I can still Google for an alternative coffee shop…
December
13, 2012 at 18:44
-
December 13, 2012 at 13:01
-
Local authorities expect half of poor residents to refuse to pay council
tax
http://www.guardian.co.uk/money/2012/oct/15/local-authorities-residents-council-tax
“Many
have compared the new council tax schemes to the “poll tax” debacle – a policy
that marked the beginning of the end of the Thatcher administration. The poll
tax, which replaced rates in England and Wales in 1990, was a flat-rate charge
on adults with a 20% levy on the unemployed. It was scrapped after two
years.”
Progressive taxes are the ones other people pay……
December 13, 2012 at 12:37
-
Well, it is pantomime season.
“Evil capitalist lackeys!”
“Oh no they’re not!”
“Oh yes they are!”
Be careful Grauniadistas – they’re behind you….
December 13, 2012 at 14:59
-
Jest Ye not. The casuals United blog has a pretty scary peice. A screen
shot of twitter comments from lefties, calling for social services to take
the kids seen enjoying a social day out with their EDL supporting
parents.
{ 37 comments }