If you haven’t heard about Starbucks’ tax problem, here is a very brief synopsis. A Reuters story broke last week which outed the popular coffee chain for having paid only £8.6 million on sales of £3 billion in Britain since 1998. And then people were outraged when Starbucks offered to come clean by paying £20 million over the next two years, as if they are in a position to simply offer whatever they feel is a fair amount.
#1 – How dare Starbucks avoid paying taxes at this time of extreme belt-tightening all across Europe! If multinational corporations would just pay their share in taxes, then the UK and other European countries wouldn’t be in such bad shape.
#2 – How dare Starbucks think they can just throw out a figure they determine is fair when regular tax payers must pay everything they owe plus penalties & interest on top of the original tax debt!
But let’s put this in perspective. The media fails to emphasize the fact that Starbucks isn’t doing so hot in the UK; they haven’t been making a profit. Rents and royalties have been expensive. Correct me if I’m wrong, but Starbucks is not being accused of doing anything illegal; they are being accused of tax avoidance (i.e., paying as little in taxes as legally required).